Advanced · bullish
Covered Strangle Option Calculator
Long stock + short OTM call + short OTM put. Bullish income, elevated downside risk.
How this Covered Strangle calculator works
This free Covered Strangle profit calculator estimates profit and loss across stock prices and dates. Use live quotes and the option chain (via the local data proxy), then review max profit, max loss, breakevens, ROI on risk, probability of profit, and a date × price heatmap or numerical matrix.
- At expiration: intrinsic payoff for each option leg (and stock, if included).
- Before expiration: Black–Scholes theoretical value using each leg’s IV and DTE.
- Multi-expiry: near-term legs settle first; longer-dated legs keep remaining time value.
Typical legs for a Covered Strangle
Default template legs (edit freely or replace from the option chain):
- Leg 1: sell call @ strike template 110
- Leg 2: sell put @ strike template 90
When traders use a Covered Strangle
Market outlook: bullish. Use the calculator to stress-test strikes and premiums before placing an order. Options involve substantial risk of loss and are not suitable for every investor.
Frequently asked questions
What is a Covered Strangle options strategy?
Long stock + short OTM call + short OTM put. Bullish income, elevated downside risk.
How do I calculate profit and loss for a Covered Strangle?
Enter the underlying price, strikes, premiums, and contracts in the Covered Strangle calculator. The tool shows max profit, max loss, breakeven points, and a P/L heatmap from now until expiration using Black–Scholes before expiry and intrinsic value at expiration.
Is the Covered Strangle strategy bullish?
This strategy is generally considered bullish in market outlook. Always confirm risk, margin, and assignment rules with your broker before trading.
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