Short Put (cash-secured)
Outlook: Bullish
Single leg
Sell a put backed by cash. Either collect premium or buy the stock at the strike.
Max profit
Premium collected.
Max loss
(Strike - premium) × 100, reached if the underlying goes to zero.
Breakeven
Strike - premium.
Legs
Short
1×
put
ATM −5
Structure
Short 1 put at a strike at or below current spot. Account holds (strike × 100) in cash.
When to use
You would happily own the underlying at the strike. Income on names you want to acquire at a discount.
Example
AAPL at $185, willing to own at $180. Short 180 put 30 DTE for $2. Either keep $200 or buy AAPL at $178 effective basis.
Notes
- Wheel strategies start here. Filter test: would you still want the shares if assigned?
Build it in the simulator
Open this structure in the app, adjust spot, IV, and DTE, and watch the payoff and Greeks move.
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