Apple Cash Secured Put Example

The cash-secured put strategy allows you to generate income and potentially buy stocks at a discount. It involves selling a put option while setting aside enough cash to buy the stock if assigned.

• Stock: Apple (AAPL)
• Current Price: $190
• Sell 1 Put: Strike $185, Premium $2.00
• Premium: $2.00 ($200 per contract)
• Income: $200

Outcome:

• If Apple stays above $185 by expiration, you keep the full $200 premium.
• If Apple stays below $185 by expiration buy 100 shares at 185, still keep the full $200 premium.

How It Works:

• Choose a stock you want to own.
• Sell a put option at a strike price you'd be happy to buy it.
• Set aside enough cash to purchase 100 shares.
• If the stock stays above the strike, you keep the premium.
• If it drops below, you're assigned the stock and still keep the premium.