Cash-Secured Put Calculator
Work out exactly what a cash-secured put pays you, how much cash it ties up, and how far the stock can fall before you lose money. Nothing to sign up for — change any number and the results update immediately.
Cash required
$1,600
16.00 × 100 × 1
Premium collected
$55
Yours to keep either way
Return on capital
3.44%
Over 35 days
Annualized return
35.8%
Comparison figure, not a forecast
Breakeven price
$15.45
Strike minus premium
Downside protection
11.7%
Fall from today before a loss
If it expires worthless: you keep $55 and your $1,600 is released — a 3.44% return in 35 days.
If you're assigned: you buy 100 shares at $16.00 for $1,600, but because you kept the premium your effective cost is $15.45 per share — 8.6% below today's price before the premium is even counted.
How the Numbers Are Calculated
None of this is complicated, and it's worth understanding rather than trusting a box:
- Cash required = strike × 100 × contracts. Your broker holds this until the position closes.
- Return on capital = premium ÷ strike. Measuring against the collateral, not the stock price, is what keeps the figure honest.
- Annualized = return on capital × (365 ÷ days). Use it to compare a 30-day trade against a 45-day one.
- Breakeven = strike − premium. Below this you're losing money on assignment.
- Downside protection = how far the stock can fall from today before hitting breakeven.
The number most people over-weight is annualized return. It assumes you find an equally good trade the moment this one closes, every time, for a year. Treat it as a way to rank candidates against each other, not as a yield you'll actually earn.
What the Calculator Can't Tell You
It prices the trade, not the risk. Two puts can show an identical 3% return on capital while being completely different propositions — one on a stable dividend payer, the other on a stock that's fallen 30% this month and has earnings next week. The maths is the same; the outcomes are not.
Before selling any put, check the things this page can't see: implied volatility rank (is the premium actually rich, or does it just look big?), options liquidity, whether earnings fall before expiration, and — most importantly — whether you'd genuinely be content owning the shares. Our cash-secured put screener checks all of those across 300+ tickers, and this guide covers the mechanics if you're new to the trade.
Already assigned and writing calls against the shares? The covered call calculator is the other half of the wheel, and the wheel strategy calculator models both legs as one complete cycle.
Frequently Asked Questions
How do you calculate return on a cash-secured put?
Return on capital is the premium collected divided by the collateral required. Collateral is the strike price times 100 per contract. Selling a $16 put for $0.55 collects $55 against $1,600 of collateral, which is a 3.4% return for the length of the trade.
How is annualized return calculated on a cash-secured put?
Annualized return is the return on capital multiplied by 365 divided by the days to expiration. A 3.4% return over 35 days annualizes to about 36%. It is a comparison tool for trades of different lengths, not a prediction, because it assumes you keep redeploying the capital at the same rate.
What is the breakeven price on a cash-secured put?
Breakeven is the strike price minus the premium received per share. If you sell a $16 put for $0.55, your breakeven is $15.45. You only lose money if the stock finishes below that price, because the premium you kept offsets the first $0.55 of decline.
How much cash do I need for a cash-secured put?
Strike price times 100 per contract. A $16 strike requires $1,600 held as collateral, regardless of the stock's current price. Your broker freezes that amount until the position expires or you buy it back.
What is downside protection on a cash-secured put?
Downside protection is how far the stock can fall from its current price before you start losing money, measured to your breakeven. It combines the gap between the stock price and your strike with the premium you collected, and is the clearest single measure of how conservative a put is.
Want this as a spreadsheet?
Free Google Sheets version with all three calculators — cash-secured put, covered call, and the full wheel cycle — so you can model trades offline and keep your own copy.
Single-trade math only. The screener and income sheets add live data, trade journalling and tax estimates.