Consider a hypothetical example in which a call with a strike price of 100 yen is bought for a premium of 5 yen. The break-even point is 105 yen. The position makes a profit if the underlying is above 105 yen at expiry and a loss if it is below. The seller of the same call also breaks even at 105 yen, with profit and loss in the opposite direction to the buyer.
Break-even point
- Japanese
- 損益分岐点
- Last reviewed
- September 24, 2026
This is a draft, shown for review before publication.
The break-even point is the price of the underlying at which the profit or loss at expiry of an option or similar contract is zero. For a call option (call) it is the strike price plus the premium, and for a put option (put) it is the strike price minus the premium.