Cash-Secured Put Calculator
See your annualized yield, breakeven, and capital required before you sell the put. Know exactly what you'll earn — and what you're risking.
How to Use This Calculator
Type in a ticker and the calculator grabs live options data. Pick your expiration and strike, and you'll see annualized yield, breakeven price, capital required, probability of expiring OTM, and a payoff diagram — everything you need before placing the trade.
The strike comparison table is where the real value is. It lines up multiple strikes side by side so you can spot the best premium-to-risk ratio in seconds. I usually compare the 0.20, 0.25, and 0.30 delta strikes. Look for the one where annualized yield is solid and the breakeven sits comfortably below the current price.
The payoff diagram shows your P&L at every stock price at expiration. Green zone to the right of breakeven = profit. Red zone to the left = you're buying shares at a loss relative to the strike. But remember — your actual cost basis after assignment is lower than the strike because of the premium you collected.
When to Use This Calculator
Run this before every CSP trade. It answers the three questions that actually matter:
- Is the yield worth tying up your cash? I won't sell a CSP under 12% annualized — the premium's too thin for the capital at risk. If you're targeting 15–30% annualized, this calculator shows you exactly where each strike lands.
- Would you actually buy the stock at that breakeven? If the breakeven is above support or above what you'd pay in a market order, pick a lower strike. Don't chase premium on a stock you wouldn't want to own.
- Are you comparing apples to apples? A 14-day put looks cheap next to a 45-day put, but annualized yield puts them on equal footing. Sometimes the short-dated trade wins.
Got assigned? Switch to the Covered Call Calculator and keep the wheel spinning.
What Is a Cash-Secured Put?
Selling a cash-secured put (CSP) means you're telling the market: “I'll buy this stock at $X if it drops — and I've got the cash to back it up.” They pay you premium upfront for taking that risk. If the stock stays above your strike, you keep the premium and do it again. That's one leg of the wheel strategy, and it's how I built most of my early account.
You sell the put, collect premium immediately, and set aside enough cash to buy 100 shares at the strike if needed. Stock stays above the strike? Put expires worthless, you keep the money, no shares change hands. That's the goal most cycles.
How the Yield Works
Annualized yield tells you how much you're making relative to the cash you've got locked up. Say you sell a 30-day put at a $50 strike for $1.20. That's $5,000 in capital and $120 back in your pocket. That's 2.4% in one month, or about 29.2% annualized. Good money — but don't assume every cycle will be that clean.
Risk Management
Worst case? The stock goes to zero and you own 100 worthless shares at the strike price. That's the maximum loss, and it's real. In practice, your breakeven is the strike minus the premium you collected. Pick strikes at or below support levels, on stocks you'd actually want to own, and keep your position sizes reasonable. I target 30–45 day expirations around 0.30 delta. That's the balance that works for me.
If Assigned: What Happens Next
If the stock drops below your strike at expiration, you're buying 100 shares. Don't panic — your effective cost basis is the strike minus all premiums you've collected. If you've sold three rounds of puts before getting assigned, you're already well below the strike. Assignment isn't a failure. It's just the next phase of the wheel.
Now you start selling covered calls above your cost basis. Every call premium lowers your cost basis even further. You're getting paid while you wait for the stock to recover. That's the whole point.
Post-Assignment Checklist:
- 1. Calculate your effective cost basis (strike - total premiums collected)
- 2. Wait for a small bounce or IV spike before selling your first covered call
- 3. Sell calls at or above your cost basis — don't lock in a loss unless you're done with the stock
- 4. Use our Covered Call Calculator to model strikes and yields
Key Formulas
Breakeven Price = Strike − Premium Received
Capital Required = Strike × 100
Cycle Return % = (Premium / Capital Required) × 100
Annualized Yield = Cycle Return × (365 / DTE)
Effective Cost Basis (after assignment) = Strike − Total Premiums Collected
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Frequently Asked Questions
What delta should I use for cash-secured puts?
I sell most of my CSPs at 0.25–0.30 delta. That's roughly a 70–75% chance the put expires worthless. It's the sweet spot — enough premium to be worth your time, but not so aggressive that you're getting assigned every other cycle. When the market's choppy, I'll drop to 0.20 delta and accept the smaller premium. Not every trade needs to be a home run.
How do you calculate CSP yield?
Annualized yield = (Premium / (Strike × 100)) × (365 / DTE) × 100. Real example: you sell a $50 strike put for $1.20 with 30 DTE. That's $120 on $5,000 in capital — 2.4% in one month, or about 29.2% annualized. Annualizing lets you compare a 14-day trade to a 45-day trade on equal footing. Just don't assume every cycle will hit that number.
What happens when you get assigned on a CSP?
You buy 100 shares at the strike price. But here's the thing — your actual cost basis is the strike minus every premium you've collected. If you sold three rounds of puts for $1.20 each before getting assigned, you're already $3.60 per share below the strike. Then you start selling covered calls on those shares and keep lowering it.
How much cash do I need to sell a CSP?
You need the full amount to buy 100 shares at the strike. A $50 strike means $5,000 locked up. A $200 strike means $20,000. Some brokers let you do it on margin, but I wouldn't recommend it if you're learning. Margin turns a predictable income strategy into a leveraged bet, and that's a different game entirely.
Should I close my CSP early or let it expire?
I close most of mine at 50–70% of max profit. Why? Because the last 30% takes the longest to decay and ties up your capital. Close it, sell a new put, reset the theta clock. You'll make more over time than squeezing every last penny. Use the Exit Analysis Calculator to see the exact math for your trade.
Options involve risk and are not suitable for all investors. All calculations are estimates — actual results will vary. Not financial advice. Full disclosure