Measure cash required, premium income, and the effective share purchase price.
Position inputs
Manual values work without a market-data connection.
Strategy summary
Expiration payoff metrics.
Cash required
$9,500.00
Premium income
$200.00
Effective purchase price
$93.00
Break-even
$93.00
Maximum profit
$200.00
Maximum loss
$9,300.00
Annualized return
25.61%
Methodology
Maximum loss assumes the underlying falls to zero. Annualized return is a simple annualization and not a forecast.
How this calculator works
A cash-secured put sells a put while reserving cash to buy shares if assigned at the strike.
How to use it
Enter the intended put strike and received premium, then confirm the full cash requirement fits the account plan. Use the effective purchase price as a reference for an assigned share position, not as protection against a large decline.
Formula, payoff, and assumptions
Required cash is strike × 100 × contracts; effective purchase price is strike minus premium per share.
Cash required assumes one standard contract represents 100 shares and the put is fully cash secured. It does not estimate buying-power treatment at an individual broker.
Practical example
Selling one $95 put for $2 reserves $9,500 and creates a $93 effective purchase price before fees.
Reading this result
The effective purchase price is a planning reference, not a floor beneath the stock. Compare the reserved cash with the downside you would accept if assignment occurs after a larger decline.
Common planning mistake
Do not treat premium as a yield without considering the cash tied up and the possibility of owning shares well above their market value after assignment.
Risk and limitations
The underlying can fall far below the effective purchase price. Assignment and annualized returns are not guaranteed.
