Covered call roll calculator
Rolling a covered call means buying back the call you sold and selling a new one with a later date, a different strike or both. The net credit or debit is the new premium minus the buyback cost.
How the numbers are calculated
The net per share is the new call premium minus the cost to buy back the current call. Multiply by 100 shares and by the number of contracts for the total.
The new ceiling is the new strike plus the net credit per share, or minus the net debit. It shows the effective sale price per share the roll sets up. It leaves out the premium from the original call.
Covered call roll example
The current call costs $2.40 to buy back. The new call at a $105.00 strike pays $2.90.
The net is $0.50 per share, which is a credit of $50.00 for one contract. The new ceiling is $105.50.
Questions about this calculator
Does rolling for a credit mean I made money?
Not by itself. The credit only covers the cost of moving the position. Your gain or loss on the shares and the original call is a separate figure.
Why pay a debit to roll up?
A higher strike raises the price you could sell the shares at. You pay for that with a debit. The ceiling rises by the strike gap minus the debit.
What about ex-dividend dates?
A call that is in the money just before an ex-dividend date can be exercised early. Check the date before choosing an expiry.
Which price do I use for the buyback?
The ask. You use the bid on the new call. The gap between them cuts the net credit.
This page is for educational purposes only and is not financial or tax advice.