Selling cash-secured puts on META

Selling a put transfers the downside between $530 and zero to you, and you are paid $11.23 per share for taking it. "Cash-secured" simply means you hold the $53,000 required to buy the shares instead of leaning on margin. Same position, honest denominator.

At August 28, 2026: above $530 the put expires worthless and you keep $1,123 — that is the maximum this trade can make, $1,123. Below it you're assigned 100 shares at $530, with an effective cost basis of $518.77 once the credit is applied. That is 6.8% below where META trades today.

The engine puts the probability of keeping the full credit at 75% on META at $556.71 with 40% ATM implied vol on the Aug 28 expiry. High win rate, capped payoff, uncapped-to-zero loss — the risk profile of every short-premium trade. It is not free money; it is a rent cheque for underwriting someone else's insurance.

Max loss is $51,877 — the strike, less the credit, times 100, if META goes to zero. That number is not theoretical on single names; it is simply unlikely. Size the position against that figure, not against the premium.

The real-world failure mode is a gap, and META has the catalysts for one: earnings (capex guidance is the swing factor) and ad-market datapoints. A put sold 4.8% out of the money offers no protection at all against a move twice that size overnight.

Liquidity is a risk, not a convenience. The moment you most want out of a short-premium position is the moment the spread is widest, and the exit price you modelled at mid will not be available.

The notional is the story. One contract controls a five-figure position, so a covered call here is not a starter trade and a cash-secured put ties up more capital than most retail accounts want in one name. What you get for it is a genuinely elevated between-print premium — Meta implies more vol than it realizes for most of the quarter and then makes up the difference in a single session.

META's Aug 28 strikes are $5 apart near the money (0.90% of spot). Workable granularity — though every rung you move a strike is a material change to the payoff, not a rounding. 17k contracts of open interest on Aug 28 is workable around the money and thin in the wings — width costs more here than the ladder suggests. 46 strikes on that expiry — 40% of the board — carry prints that agree with their own implied volatility and hold up across the ladder, and those are the strikes priced here. Liquid, but the dollar-wide strikes near the money mean spreads at retail width need several rungs — check the ladder before assuming a $5 wing exists.

Skew is inverted: the 25-delta CALL implies 3.8% more vol than the put. That is the market pricing upside risk above downside risk — a squeeze, a takeover rumour, or a crowded short. Selling calls into an inverted skew pays better than usual and is riskier than usual for exactly the same reason. The term structure is flat inside 1.5% between the two captured expiries, so there is no calendar edge to harvest and no event visibly priced into one month over the other.

At 40% ATM implied vol, the Aug 28 options are pricing a one-standard-deviation move of $60.16 over 27 days — roughly −10.8% to +10.8%, or $496.55 to $616.87. A short-premium structure here is a bet that 10.8% over 27 days is more than META will actually use. That is the thesis, stated honestly.

The mistake this name punishes hardest: Underestimating position size because the delta looked small. On a name at this price, a single condor's max loss is a real fraction of a retail account.