Options contracts are popular financial derivatives that offer investors and traders the opportunity to profit from the price movements of underlying assets without actually owning those assets. One crucial concept in options trading is the breakeven price, which helps traders determine the point at which their options position transitions from a loss to a profit or vice versa. In this article, we’ll explore what the breakeven price is and how to calculate it. The breakeven price for options contracts is the underlying asset’s price at which the trader neither makes a profit nor incurs a loss on their options position. It is the critical point at which the cost of purchasing or holding the options contract equals the potential profit that can be realized by exercising or selling the contract. For call options, the breakeven price is the strike price plus the premium paid for the option, while for put options, it is the strike price minus the premium paid. This point represents a neutral scenario for the trader, as they have neither gained nor lost money. The formula to calculate the breakeven price for