Break-Even Point - BEP

Break-Even Point - BEP

1. In general, the point at which gains equal losses.

2. In options, the market price that a stock must reach for option buyers to avoid a loss if they exercise. For a call, it is the strike price plus the premium paid. For a put, it is the strike price minus the premium paid.

Notes:

For businesses, reaching the break-even point is the first major step towards profitability.

See also: Expenses, Option, Revenue