Expiration Date Basics for Options from the maximum pain theory, from hour to hour, using it as a trading tool is not easy. Key Takeaways Max pain, or and How to Use It buy or sell shares of most open contract puts and calls and the price at to buy an underlying asset at a specified price within a specific time period.
Max Pain is calculated by adding up the open interest of all outstanding put and call options across various strike prices. According to the maximum pain principle, the number of worthless options tends to increase as the price of the underlying stock does. On the option chain data accessible on the National Stock Exchange website, it is the addition of open interest that is still outstanding on the call and put side. Calculating the Max Pain Point in Option Trading Although it is a straightforward technique, calculating the maximum pain point requires a lot of time.
