CSTL Cash-Secured Put Strategy

CSTL (Castle Biosciences, Inc.), in the Healthcare sector, (Medical - Diagnostics & Research industry), listed on NASDAQ.

Castle Biosciences, Inc., a commercial-stage diagnostics company, focuses to provide diagnostic and prognostic testing services for dermatological cancers. Its lead product is DecisionDx-Melanoma, a multi-gene expression profile (GEP) test to identify the risk of metastasis for patients diagnosed with invasive cutaneous melanoma. The company also offers DecisionDx-UM test, a proprietary GEP test that predicts the risk of metastasis for patients with uveal melanoma, a rare eye cancer; DecisionDx-SCC, a proprietary 40-gene expression profile test that uses an individual patient's tumor biology to predict individual risk of squamous cell carcinoma metastasis for patients with one or more risk factors; and DecisionDx DiffDx-Melanoma and myPath Melanoma, a proprietary GEP test to diagnose suspicious pigmented lesions. It offers test services through physicians and their patients. The company was founded in 2007 and is headquartered in Friendswood, Texas.

CSTL (Castle Biosciences, Inc.) trades in the Healthcare sector, specifically Medical - Diagnostics & Research, with a market capitalization of approximately $550.5M, a beta of 1.11 versus the broader market, a 52-week range of 14.59-44.28, average daily share volume of 400K, a public-listing history dating back to 2019, approximately 784 full-time employees. These structural characteristics shape how CSTL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.11 places CSTL roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a cash-secured put on CSTL?

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 CSTL snapshot

As of May 15, 2026, spot at $19.16, ATM IV 84.50%, IV rank 18.23%, expected move 24.23%. The cash-secured put on CSTL 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 34-day expiry.

Why this cash-secured put structure on CSTL specifically: CSTL IV at 84.50% is on the cheap side of its 1-year range, which means a premium-selling CSTL cash-secured put collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 24.23% (roughly $4.64 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CSTL expiries trade a higher absolute premium for lower per-day decay. Position sizing on CSTL should anchor to the underlying notional of $19.16 per share and to the trader's directional view on CSTL stock.

CSTL cash-secured put setup

The CSTL 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 CSTL near $19.16, the first option leg uses a $18.20 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CSTL chain at a 34-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 CSTL shares for the stock leg in covered calls and collars).

ActionTypeStrike / BasisPremium (est)
Sell 1Put$18.20N/A

CSTL cash-secured put risk and reward

Net Premium / Debit
N/A
Max Profit (per contract)
Unbounded
Max Loss (per contract)
Unbounded
Breakeven(s)
None on modeled curve
Risk / Reward Ratio
N/A

Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.

CSTL cash-secured put payoff curve

Modeled P&L at expiration across a range of underlying prices for the cash-secured put on CSTL. 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.

When traders use cash-secured put on CSTL

Cash-secured puts on CSTL earn premium while a trader waits to acquire CSTL stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning CSTL.

CSTL thesis for this cash-secured put

The market-implied 1-standard-deviation range for CSTL extends from approximately $14.52 on the downside to $23.80 on the upside. A CSTL cash-secured put lets a trader earn premium while waiting to acquire CSTL 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 CSTL IV rank near 18.23% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on CSTL at 84.50%. As a Healthcare name, CSTL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CSTL-specific events.

CSTL 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. CSTL positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CSTL alongside the broader basket even when CSTL-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on CSTL carry tail risk when realized volatility exceeds the implied move; review historical CSTL earnings reactions and macro stress periods before sizing. Always rebuild the position from current CSTL chain quotes before placing a trade.

Frequently asked questions

What is a cash-secured put on CSTL?
A cash-secured put on CSTL is the cash-secured put strategy applied to CSTL (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 CSTL stock trading near $19.16, the strikes shown on this page are snapped to the nearest listed CSTL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are CSTL 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 CSTL cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 84.50%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CSTL cash-secured put?
The breakeven for the CSTL cash-secured put priced on this page is no defined breakeven on the modeled curve 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 CSTL market-implied 1-standard-deviation expected move is approximately 24.23%; 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 CSTL?
Cash-secured puts on CSTL earn premium while a trader waits to acquire CSTL stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning CSTL.
How does current CSTL implied volatility affect this cash-secured put?
CSTL ATM IV is at 84.50% with IV rank near 18.23%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

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