PnL (call)
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The premium is the price of being wrong

An option caps your loss at the premium but that premium is a real, frequent loss. Know your break-even before buying. Find it on the options break-even calculator.

Options PnL has more moving parts

A spot position's PnL is one subtraction. An option's PnL before expiry depends on the underlying move, time passed, and what implied volatility did — three dials, and the last two usually work against buyers.

Concrete case: you buy a 1-week BTC call, and BTC rises 2% the next day. You can still be down — if IV dropped after an event resolved (the "IV crush"), the volatility repricing can outweigh your directional gain. Traders who buy options into announcements learn this expensively: right about direction, wrong about the vol, net loser.

At expiry it simplifies to intrinsic value: max(0, spot − strike) for calls, minus the premium you paid. Before expiry, time decay (theta) bleeds the position daily — a week-out at-the-money option can lose 2–4% of its value per day just standing still. Directional conviction with a deadline is what you're actually buying.

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