What this is
This is a paper trading simulator for options. Pick a scenario, then step through it one day at a time. The stock price follows a randomly generated path, the option is repriced each day with the same Black-Scholes engine that powers the calculator, and you decide when to close. No real money, no account, no signup.
A payoff diagram shows what a position is worth at expiration. It can't show what it feels like to hold that position through a two-week drawdown, or what time decay does to it while the stock goes nowhere. That's what this is for.
How the simulation works
Each run generates a random price path using the same statistical model that underlies Black-Scholes option pricing (geometric Brownian motion). The path has no built-in direction — the simulated stock is equally likely to drift up or down, so the results don't quietly favor one kind of trade. The volatility of the path matches the option's implied volatility, and the position is marked to model price at the end of each simulated day.
One run is one possible outcome, not a verdict. A position with a 76% probability of profit still loses roughly one time in four. Run the same scenario several times and you'll see that range for yourself — that's the point. The earnings scenario adds one scripted event: a gap on report day sized off the implied move, with implied volatility crushing immediately after — the stock can gap your way and the crush can still take the trade. A drift control lets you tilt the simulated path up or down; it defaults to flat and says so.
What it doesn't model
Positions close at model price. Real fills include bid-ask spread and slippage, especially on multi-leg positions. Implied volatility stays constant within a run except in the earnings scenario, where it ramps into the report and crushes after on a fixed schedule — real IV moves less predictably than that. Early assignment on short options isn't simulated; the sim flags elevated assignment risk but never assigns. Simulated prices are randomly generated and do not represent any real security.
Questions
Is this the same as paper trading at a broker?
Same idea, different tradeoff. Broker paper trading uses real market data but requires an account and runs in real time — one trade takes weeks to play out. This compresses a 45-day position into a minute of tapping, so you can see many outcomes quickly. Use this to build intuition; use broker paper trading to rehearse real execution.
Why is the result different every run?
Each run draws a new random path. That's deliberate — the outcome of one options trade is one sample from a distribution. Seeing the same position win some runs and lose others is a more honest picture than any single backtest.
Can I practice my own position?
Not yet — the current scenarios are fixed. Build and model your own positions in the options profit calculator, including multi-leg strategies with up to 8 legs.