Selling Puts To Buy Stock Access

There are two primary outcomes at the contract's expiration:

Selling puts to buy stock, often called a (CSP) strategy, allows you to potentially acquire shares at a discount while getting paid to wait. Instead of buying a stock at its current market price, you sell a contract that obligates you to buy it at a lower "strike price". How the Strategy Works selling puts to buy stock

When you sell a put option, you receive an upfront payment called a . To make it "cash-secured," you must set aside enough cash in your brokerage account to cover the cost of the shares if you are forced to buy them. There are two primary outcomes at the contract's

: The option expires worthless. You keep the entire premium as profit and do not buy the stock. To make it "cash-secured," you must set aside

: You are "assigned" the shares. You must buy them at the strike price, but your effective cost basis is lower because you keep the upfront premium. Key Benefits Putting Put-Writing Into Perspective - Neuberger Berman