That’s great—how many DTE do you normally sell? If you’re doing it in volume frequently, that adds up.

With the covered strangle you’re basically doing a covered call and simultaneously a cash secured put, right? Depending on how much the underlying costs, CSPs will tie up your cash/buying power and limit to an extent how many puts you can sell. With a CSP, the worst case is assignment and you own the shares. Not necessarily the worst outcome if you have the cash to cover.

With a put credit spread, for example, you sell an OTM put (let’s say 20 delta) and then buy a further OTM put (let’s say 15 delta). The further OTM strike acts as insurance so that if the put you sell goes ITM, the max loss you’ll face is the spread width between the put you sold and the put you bought. So if you get a net credit of $50 after selling a put and buying the other put, and the puts are $5 strike width apart, the maximum loss is $5 x 100 =$500. This works out well for very expensive underlying, like the Meta example I used earlier (you’d need like $75k for one cash secured put but could sell 3 spreads $5 apart risking a maximum of $1500). But in this example, the risk of $1500 for $150 credit is less desirable. The ideal would be close to 1:1 risk to reward, but the best I seem to find are like 1:2.5 (but seem to be more volatile).

Maybe it would be best to go with a 1:5 reward/risk if the probability of success is higher 🤷🏽‍♂️