Covered Strangle Calculator
A covered strangle combines long stock with a short OTM call and a short OTM put (cash secured): you collect two premiums with capital for stock and possible put assignment.
Stock Position
Short Call
Short Put
Enter option details to see payoff diagram
Trade Summary
Total Premium
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Max Profit
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Commonly asked Covered Strangle questions
What is a covered strangle?
You hold (or buy) stock, sell an out-of-the-money call against it, and sell an out-of-the-money put that is cash secured—collecting call and put premium.
How much capital do I need?
Typically stock cost for the covered shares plus cash or margin to secure the short put (often strike × 100 × contracts per broker rules).
What are the main risks?
Stock can fall (you keep shares); the short put can assign you to buy more shares at the put strike; the short call can cap upside or lead to assignment of shares away.
Covered strangle vs long strangle?
A long strangle is long call and long put with no stock; covered strangle is income-focused with stock plus two short options.
Why sell both sides?
To collect more premium than a covered call alone if you are neutral to mildly bullish and willing to manage assignment risk.
Is this related to the wheel?
Some traders combine cash-secured puts and covered calls in sequences; a covered strangle is one way to run premium on both sides while long stock.
Related Calculators
Daily Cumulative P&L
$33,989.51+$32,609.07
Avg Trade: $60.80
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Best Performing
Morning Breakouts
82% Win Rate
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