# Max pain

Canonical: https://halfonadouble.com/learn/max-pain
Data through: 2026-10-02 close
Publisher: Half on a Double

**Max pain is the underlying price at which the total value paid out on
expiring options is smallest.** It is the point that hurts option buyers
the most and option sellers the least, hence the name.

## How it is calculated

For one expiry, take every strike with open interest. For each candidate
price `S`:

- every call with strike `K < S` pays `(S − K)` per contract, times its open interest,
- every put with strike `K > S` pays `(K − S)` per contract, times its open interest.

Sum those payouts over the chain. The candidate price with the smallest
total is max pain. It needs only strikes and open interest, no model, and
it is usually reported for the nearest expiry, since that is the one whose
contracts are about to settle.

## Why people watch it

The theory is that option sellers, mostly market makers, have an incentive
to see the underlying settle where their payout is least, and that their
hedging near expiry drifts price toward it: "pinning". The evidence is
mixed. Pinning to round strikes is documented in the academic literature,
but the drift toward the max-pain strike specifically is small and
unreliable once you condition on where the stock already is. Treat max pain
as a description of where the payout landscape is flattest, not as a
target the stock is pulled to.

## Max pain versus gamma max

They are different questions. Max pain is about **expiry payout**: it uses
only open interest and strikes for one expiry. [Gamma max](/learn/gamma-max)
is about **hedging pressure**: it uses every expiry, weights each contract
by its gamma (which depends on implied volatility and time), and finds the
price where the summed gamma of the whole chain peaks. Max pain says where
options expire cheapest; gamma max says where dealers' hedge adjustments
are largest. They can coincide, and often do not.

## On this site

Ticker pages publish max pain for the nearest listed expiration, its expiration
date, and a second value with every listed expiration pooled. The
[nearest max pain screen](/screens/nearest-max-pain) ranks current distance from
the nearest-expiration value. The pooled value describes the full chain but
should not be mistaken for the settlement economics of any one expiration.

## Related

[Gamma exposure](/learn/gamma-exposure) · [Put/call ratio](/learn/put-call-ratio) · [Screens](/screens)