Cash-Secured Put (CSP)
An options strategy where you sell a put while holding enough cash to buy the underlying if assigned.
Formula
More Details
What is a Cash-Secured Put?
A Cash-Secured Put (CSP) is selling a put option while holding enough cash to purchase the underlying stock if you get assigned. It's a popular income strategy and the first leg of the Wheel Strategy.
Learn more: Options Greeks Guide | Options Command Center | Greeks Analysis
How CSP Works
- Sell a put at a strike price you'd be happy to own the stock
- Collect premium upfront
- If stock stays above strike: Put expires worthless, keep premium
- If stock falls below strike: Get assigned, buy 100 shares at strike
Capital Reserved Calculation
Capital Reserved = Strike Price x 100 x Contracts
Example: Sell 1 TSLA 250 Put
Capital Reserved = 250 x 100 = 25,000 dollars
This is the cash you must have available if assigned.
CSP Return Metrics
ROI = (Premium Collected / Capital Reserved) x 100
Annualized ROI = (ROI / Days to Expiration) x 365
Example: Sell SOFI 15 Put for 0.85 premium, 30 DTE
* Premium: 0.85 x 100 = 85 dollars
* Capital Reserved: 15 x 100 = 1,500 dollars
* ROI: 85 / 1,500 = 5.67%
* Annualized: (5.67 / 30) x 365 = 68.9%
TradesViz CSP Analytics
The Options Command Center provides dedicated CSP analysis:
* Total Capital Reserved across all short puts
* Premium Collected
* Weighted Average APY
* Capital Release Schedule (bar chart by expiration)
* Next Expiration date and amount
Important: Premium is NOT realized P&L until the position is closed!
Where to find it in TradesViz
Example
Sell 1 AAPL 150P for 2.50 premium. Capital Reserved is 15,000. ROI is 1.67%.