Premium paid per share. Each contract = 100 shares.
Maximum profit and loss shown at expiration only. Does not account for early assignment, dividend risk, commissions, slippage, or assignment risk before expiry.
Options are leveraged instruments that can lose 100% of premium paid.
This shows what an options position would make or lose at expiration across a whole range of stock prices, before you put any money in. The curve makes the trade-off plain: where you start making money, and exactly how much you can lose if it goes the wrong way.
Buy one call with a $105 strike that costs $2 per share. That’s $200 for the contract (100 shares). If the stock finishes at $110, the call is worth $5/share, so you net $300. If it finishes anywhere under $105, the call expires worthless and you lose exactly the $200 you paid, never more. The trade only turns a profit above the breakeven of $107 (the $105 strike plus the $2 you paid).
Buying without knowing the breakeven first. A call can rise and still lose you money if the stock doesn’t clear strike plus premium by expiry.