Chooser Option Calculator Excel Template

Price chooser options with confidence using this professional Excel template. A chooser option (also called an "as-you-like-it" option) gives you the flexibility to decide at a future date whether your option becomes a call or put — ideal when you expect significant price movement but are uncertain about direction.

What You Can Calculate

This template computes six key values using Black-Scholes decomposition:

• Chooser Option Price — The fair value of the chooser, combining call and put components
• Call Component — The embedded European call value at expiry
• Put Component — The embedded put value at the choice date using the adjusted strike
• Adjusted Strike (K') — The discounted strike used in the put-call parity decomposition
• Straddle Price — What you would pay for both call and put (for comparison)
• Chooser Discount — Your percentage savings versus buying an equivalent straddle

Required Inputs

Enter six parameters to price your chooser option:

• Stock Price (S) — Current market price of the underlying asset
• Strike Price (K) — Exercise price for both call and put alternatives
• Choice Date (T1) — When you must decide call or put (in years)
• Option Expiry (T2) — When the chosen option expires (in years)
• Risk-Free Rate — Annualized continuously compounded rate
• Volatility — Annualized standard deviation of returns

Methodology

The template uses the closed-form solution for simple chooser options based on put-call parity. The key insight is that a chooser can be decomposed into: Chooser = c(S, K, T2) + p(S, K', T1), where K' = K × e^-r(T2-T1). All option values are computed using the Black-Scholes model with standard normal distribution functions.

Assumptions & Limitations

• European exercise only (no early exercise)
• Zero dividend yield on the underlying
• Constant volatility over the option's life
• Simple chooser structure (same strike and expiry for call/put)
• Continuous trading with no transaction costs