Let's implement this calculation in Python. Options contracts allow investors to purchase the right, but not the obligation, to buy or sell an asset at a set price before the option expires.The payoff formula is: Short call payoff per share = (premium per share - (MAX (0, (share price - strike price)). A bull put spread is a limited-risk, limited-reward strategy, consisting of a short put option and a long put option with a lower strike. NerdWallet's early mortgage payoff calculator figures out how much more to pay. How much do you understand about options? Do you know and understand the formulas for the values? The two offered options are based on calculations from pension buyout options presented in the recent Illinois budget.