Cash-Secured Put Calculator

A cash-secured put is the mirror image of a covered call: instead of owning shares and selling a call, you set aside enough cash to buy the shares at a strike price, then sell a put against that cash. You collect the premium immediately, and in exchange you agree to buy the stock at the strike if it closes below that price at expiration.

It's the other half of the "wheel" strategy many options traders run: sell a cash-secured put, get assigned shares if the stock falls, then sell covered calls against those shares until they're called away, and repeat. This calculator gives you the same income-strategy numbers as the Covered Call Calculator, structured for the put side.

How does this calculator work?

Enter the stock's current price, the strike price of the put you're selling, the premium you'd collect, and the number of days until expiration.

The calculator shows how much cash the position requires (strike × 100 shares per contract), your yield on that collateral, your breakeven if assigned, and how much room the stock has to fall before that breakeven is breached.

The chart shows total position profit/loss at expiration across a range of stock prices. The premium caps your maximum profit, while the risk (like owning the stock outright below the strike) is uncapped down to zero.

Because assignment means buying 100 shares, size the trade around cash you actually want to deploy, the same discipline behind any position-sizing decision. It also pays to weigh the odds the put finishes in the money before selling, and to view the payoff next to other structures on a single profit-and-loss diagram. Getting assigned and then writing calls against the shares is the wheel.

Worked example

The stock trades at $50; you sell a 30-day put at the $47 strike for $1.20 in premium.

Cash required (collateral)

$4,700

Premium income

$120

Static yield / annualized

2.55% / 31.06%

Effective cost basis if assigned

$45.80

Downside protection

8.40%

How the numbers work

You need $4,700 set aside (the $47 strike times 100 shares) to cover buying the stock if assigned. Selling the put collects $120 in premium immediately, a 2.55% yield on that collateral over 30 days, whether or not you're ultimately assigned.

If the stock stays above $47 through expiration, the put expires worthless and you simply keep the $120: the same outcome as "return if unchanged" on a covered call.

If the stock falls below $47 and you're assigned, you buy 100 shares at $47, but your effective cost basis is $45.80 after subtracting the premium already collected. That's 8.4% below today's $50 price, your downside cushion before this trade shows a loss versus simply buying the stock today.

A cash-secured put suits an investor who's willing to own the stock at the strike price anyway. If you wouldn't want to buy the shares at that price, don't sell the put just for the premium.

Pairing this with a covered call afterward (the "wheel") turns assignment into the start of a new income trade rather than an unwanted outcome. Model the covered call leg with this site's Covered Call Calculator once you know your assigned cost basis.