How is protective put breakeven calculated?

Breakeven = stock price + put premium paid. Maximum loss = stock price - strike price + put premium (downside protected below strike). Maximum gain = unlimited upside minus put cost.

What is the cost of portfolio insurance?

1-year ATM put typically costs 5-10% of stock value (depending on volatility). 95% strike (5% OTM) put costs 3-6%. Insurance premium is the theta decay paid for protection against large drops.

Protective Put Breakeven Calculator

Calculate cost, breakeven, and protection level for protective put strategies. Determine insurance cost as a percentage of portfolio value and choose appropriate strike.

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$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate cost, breakeven, and protection level for protective put strategies. Determine insurance cost as a percentage of portfolio value and choose appropriate strike. Use the protective put breakeven result to inform your calculation.

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