Long Call
A position created by buying a call option, with loss limited to the premium and gain rising as the underlying rises.
Formula
Profit at expiry = max(Spot - Strike, 0) x Lot Size - Premium Paid x Lot Size; Break-even = Strike + Premium
Unit
₹
In depth
The long call is the most-taken position by new derivative traders and the one with the highest loss frequency, because it requires the underlying to move past the strike plus the premium within a fixed time. Probability works against it structurally: an out-of-the-money call expires worthless most of the time, which is why it is cheap. The capped loss is real and is the position's genuine merit, but capped does not mean small — losing the full premium is the modal outcome, not the tail. Time decay works against the holder every day the position is open.
Worked example
Buy a 24,000 call at 300, lot 75, cost ₹22,500. Break-even is 24,300. At an expiry of 24,450 the profit is (450 - 300) x 75 = ₹11,250; at 24,000 or below the loss is the full ₹22,500.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Long Call” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.