Matt Bart @Mattbart6 - Twitter Profile

12 days ago

CASH SECURED PUTS ARE THE MOST UNDERRATED INCOME STRATEGY IN THE MARKET!!! This is the one that pays you to wait for a price you already wanted. Save this and study it. Let's start with what it actually is. You sell someone the right to force you to buy 100 shares at a set price, before a set date. For agreeing to that, they pay you a premium upfront. That money is yours immediately. "Cash secured" means the money to buy those shares is already set aside. Now the numbers, because this is where it clicks. Stock trading at $100. You sell the $95 put, 35 days out, collect $2.00 per share. ➡️ Cash set aside: $9,500 ➡️ Premium collected: $200, today Only two things can happen. 1️⃣ Stock stays above $95 Option expires worthless. You keep the $200 and your cash is free again. That's 2.11% in 35 days. 2️⃣ Stock drops below $95 You buy 100 shares at $95. But you were paid $200, so your real cost basis is $93. The stock was at $100 when you opened it. You just bought it 7% cheaper than the price you were already willing to pay. One outcome pays you to wait. The other gets you the stock at a discount. So why is the income so consistent? Options lose value as they approach expiry. That decay is called theta and it accelerates hard in the final 30 days. Buy an option and it works against you every day. Sell one and it works for you. You're not predicting direction. You're getting paid for time passing. Where does the money come from? Premium is priced off implied volatility. More expected movement, more premium. Which means you get paid most when everyone is scared. Selling puts into a panic pays multiples of what the same strike pays in a calm market. Low volatility pays almost nothing. Don't force it. Now the part most people skip. Your upside is capped and your downside is not. Stock rips to $150? You made $200. Stock drops to $50? You own it at $93 and you're down $4,300. Read that twice. Selling puts DOES NOT reduce your risk. You carry nearly the same downside as owning the stock and trade away all the upside for a fixed payment. You're converting uncertain upside into certain income. Which leads to the only rule that matters. Never sell a put on a company you don't want to own at that strike. If you wouldn't happily buy it at $95, don't sell the $95 put, no matter how good the premium looks. Assignment isn't the strategy failing. Assignment is the strategy working. So how do you pick the strike? Delta roughly approximates the chance the option finishes in the money. ➡️ 15 to 20 delta: conservative, less premium, rarely assigned ➡️ 30 delta: the common middle ground ➡️ 40+ delta: aggressive, big premium, expect the shares Pick the strike where you actually want to own the business. Then check what delta that happens to be. On timing, 30 to 45 days is where most people land. Weeklies pay less per unit of risk and eat your attention. Two warnings. Earnings inflate premium because real risk is coming. And American options can be assigned early, usually deep in the money or around a dividend. Here's the mistake that actually hurts people. Correlation. Five puts across five stocks, market drops 12%, and you don't get assigned on one. You get assigned on all five, same day, worst possible day. Every position needs its cash simultaneously. People size each trade individually and forget they all trigger together. Size the whole book, not the single trade. Then there's the wheel. Sell a put, get assigned, sell a covered call above your cost basis, get called away, start again. Income at every stage. Final thought: this will never beat a stock that doubles and it isn't supposed to. It pays you while you wait for prices you already wanted, on companies you already did the work on. We run a lot of these inside The Assembly and members post their CSP wins nonstop. If you have idle cash sitting there doing nothing, that's where I'd start. Join from my bio before we close access again.

NoLimitGains's tweet photo. CASH SECURED PUTS ARE THE MOST UNDERRATED INCOME STRATEGY IN THE MARKET!!!

This is the one that pays you to wait for a price you already wanted.

Save this and study it.

Let's start with what it actually is.

You sell someone the right to force you to buy 100 shares at a set price, before a set date. For agreeing to that, they pay you a premium upfront. That money is yours immediately.

"Cash secured" means the money to buy those shares is already set aside.

Now the numbers, because this is where it clicks.

Stock trading at $100. You sell the $95 put, 35 days out, collect $2.00 per share.

➡️ Cash set aside: $9,500
➡️ Premium collected: $200, today

Only two things can happen.

1️⃣ Stock stays above $95

Option expires worthless. You keep the $200 and your cash is free again. That's 2.11% in 35 days.

2️⃣ Stock drops below $95

You buy 100 shares at $95. But you were paid $200, so your real cost basis is $93.

The stock was at $100 when you opened it. You just bought it 7% cheaper than the price you were already willing to pay.

One outcome pays you to wait. The other gets you the stock at a discount.

So why is the income so consistent?

Options lose value as they approach expiry. That decay is called theta and it accelerates hard in the final 30 days.

Buy an option and it works against you every day. Sell one and it works for you.

You're not predicting direction. You're getting paid for time passing.

Where does the money come from?

Premium is priced off implied volatility. More expected movement, more premium.

Which means you get paid most when everyone is scared. Selling puts into a panic pays multiples of what the same strike pays in a calm market.

Low volatility pays almost nothing. Don't force it.

Now the part most people skip.

Your upside is capped and your downside is not.

Stock rips to $150? You made $200.
Stock drops to $50? You own it at $93 and you're down $4,300.

Read that twice.

Selling puts DOES NOT reduce your risk. You carry nearly the same downside as owning the stock and trade away all the upside for a fixed payment.

You're converting uncertain upside into certain income.

Which leads to the only rule that matters.

Never sell a put on a company you don't want to own at that strike.

If you wouldn't happily buy it at $95, don't sell the $95 put, no matter how good the premium looks.

Assignment isn't the strategy failing. Assignment is the strategy working.

So how do you pick the strike?

Delta roughly approximates the chance the option finishes in the money.

➡️ 15 to 20 delta: conservative, less premium, rarely assigned
➡️ 30 delta: the common middle ground
➡️ 40+ delta: aggressive, big premium, expect the shares

Pick the strike where you actually want to own the business. Then check what delta that happens to be.

On timing, 30 to 45 days is where most people land. Weeklies pay less per unit of risk and eat your attention.

Two warnings. Earnings inflate premium because real risk is coming. And American options can be assigned early, usually deep in the money or around a dividend.

Here's the mistake that actually hurts people.

Correlation.

Five puts across five stocks, market drops 12%, and you don't get assigned on one. You get assigned on all five, same day, worst possible day.

Every position needs its cash simultaneously. People size each trade individually and forget they all trigger together.

Size the whole book, not the single trade.

Then there's the wheel. Sell a put, get assigned, sell a covered call above your cost basis, get called away, start again. Income at every stage.

Final thought: this will never beat a stock that doubles and it isn't supposed to.

It pays you while you wait for prices you already wanted, on companies you already did the work on.

We run a lot of these inside The Assembly and members post their CSP wins nonstop. If you have idle cash sitting there doing nothing, that's where I'd start.

Join from my bio before we close access again.

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Matt Bart

@Mattbart6

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