BTU Cash-Secured Put Strategy
BTU (Peabody Energy Corporation), in the Energy sector, (Coal industry), listed on NYSE.
Headquartered in St. Louis, Missouri, and founded in 1883, Peabody Energy Corporation operates as a prominent global entity in the coal mining sector. Its vast operations encompass the United States, Australia, Japan, India, China, and several other countries across Asia and beyond. The company organizes its extensive activities into key divisions: Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, and other U.S. Thermal Mining segments. Peabody's core business involves the extraction, processing, and sale of various types of coal.
BTU (Peabody Energy Corporation) trades in the Energy sector, specifically Coal, with a market capitalization of approximately $2.86B, a beta of 0.34 versus the broader market, a 52-week range of 12.67-41.14, average daily share volume of 3.5M, a public-listing history dating back to 2017, approximately 6K full-time employees. These structural characteristics shape how BTU stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.34 indicates BTU has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. BTU pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a cash-secured put on BTU?
A cash-secured put sells an out-of-the-money put while holding cash equal to the strike-times-100 obligation, keeping the premium when the underlying stays above the strike.
Current BTU snapshot
As of June 30, 2026, spot at $22.78, ATM IV 60.11%, IV rank 37.17%, expected move 17.23%. The cash-secured put on BTU below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 31-day expiry.
Why this cash-secured put structure on BTU specifically: BTU IV at 60.11% is mid-range versus its 1-year history, so the credit collected on a BTU cash-secured put sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 17.23% (roughly $3.93 on the underlying). The 31-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated BTU expiries trade a higher absolute premium for lower per-day decay. Position sizing on BTU should anchor to the underlying notional of $22.78 per share and to the trader's directional view on BTU stock.
BTU cash-secured put setup
The BTU cash-secured put below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With BTU near $22.78, the first option leg uses a $22.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BTU chain at a 31-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 BTU shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $22.00 | $1.27 |
BTU cash-secured put risk and reward
- Net Premium / Debit
- +$126.50
- Max Profit (per contract)
- $126.50
- Max Loss (per contract)
- -$2,072.50
- Breakeven(s)
- $20.74
- Risk / Reward Ratio
- 0.061
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
BTU cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on BTU. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$2,072.50 |
| $5.05 | -77.9% | -$1,568.93 |
| $10.08 | -55.7% | -$1,065.36 |
| $15.12 | -33.6% | -$561.80 |
| $20.15 | -11.5% | -$58.23 |
| $25.19 | +10.6% | +$126.50 |
| $30.22 | +32.7% | +$126.50 |
| $35.26 | +54.8% | +$126.50 |
| $40.30 | +76.9% | +$126.50 |
| $45.33 | +99.0% | +$126.50 |
When traders use cash-secured put on BTU
Cash-secured puts on BTU earn premium while a trader waits to acquire BTU stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning BTU.
BTU thesis for this cash-secured put
The market-implied 1-standard-deviation range for BTU extends from approximately $18.85 on the downside to $26.71 on the upside. A BTU cash-secured put lets a trader earn premium while waiting to acquire BTU at the strike price; the strategy is most attractive when the trader is comfortable holding the underlying at that level and IV is rich enough to compensate for the assignment risk. Current BTU IV rank near 37.17% is mid-range against its 1-year distribution, so the IV signal is neutral; the cash-secured put thesis on BTU should anchor more to the directional view and the expected-move geometry. As a Energy name, BTU options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BTU-specific events.
BTU cash-secured put positions are structurally neutral to slightly bullish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. BTU positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move BTU alongside the broader basket even when BTU-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on BTU carry tail risk when realized volatility exceeds the implied move; review historical BTU earnings reactions and macro stress periods before sizing. Always rebuild the position from current BTU chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on BTU?
- A cash-secured put on BTU is the cash-secured put strategy applied to BTU (stock). The strategy is structurally neutral to slightly bullish: A cash-secured put sells an out-of-the-money put while holding cash equal to the strike-times-100 obligation, keeping the premium when the underlying stays above the strike. With BTU stock trading near $22.78, the strikes shown on this page are snapped to the nearest listed BTU chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are BTU cash-secured put max profit and max loss calculated?
- Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium. For the BTU cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 60.11%), the computed maximum profit is $126.50 per contract and the computed maximum loss is -$2,072.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a BTU cash-secured put?
- The breakeven for the BTU cash-secured put priced on this page is roughly $20.74 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current BTU market-implied 1-standard-deviation expected move is approximately 17.23%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a cash-secured put on BTU?
- Cash-secured puts on BTU earn premium while a trader waits to acquire BTU stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning BTU.
- How does current BTU implied volatility affect this cash-secured put?
- BTU ATM IV is at 60.11% with IV rank near 37.17%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.