ELMD Cash-Secured Put Strategy

ELMD (Electromed, Inc.), in the Healthcare sector, (Medical - Devices industry), listed on AMEX.

Electromed, Inc. develops, manufactures, markets, and sells airway clearance therapy and related products that apply high frequency chest wall oscillation (HFCWO) therapy in pulmonary care for patients of various ages in the United States and internationally. The company offers SmartVest airway clearance system; SmartVest SQL System that consists of an inflatable therapy garment, a programmable air pulse generator, and a patented single-hose that delivers air pulses from the generator to the garment; and SmartVest Connect, a wireless technology with personalized HFCWO therapy management portal for patients with compromised pulmonary function. It also provides single patient use SmartVest and SmartVest Wrap products for health care providers in the acute care setting. The company offers its products primarily to home health care market for patients with bronchiectasis, cystic fibrosis, and neuromuscular disease. Electromed, Inc. markets its products primarily to physicians and health care providers, as well as directly to patients. The company was incorporated in 1992 and is headquartered in New Prague, Minnesota.

ELMD (Electromed, Inc.) trades in the Healthcare sector, specifically Medical - Devices, with a market capitalization of approximately $281.6M, a trailing P/E of 27.66, a beta of 0.39 versus the broader market, a 52-week range of 17.73-34.43, average daily share volume of 48K, a public-listing history dating back to 2010, approximately 174 full-time employees. These structural characteristics shape how ELMD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.39 indicates ELMD has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.

What is a cash-secured put on ELMD?

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 ELMD snapshot

As of May 15, 2026, spot at $35.42, ATM IV 61.80%, IV rank 27.80%, expected move 17.72%. The cash-secured put on ELMD 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 ELMD specifically: ELMD IV at 61.80% is on the cheap side of its 1-year range, which means a premium-selling ELMD cash-secured put collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 17.72% (roughly $6.28 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 ELMD expiries trade a higher absolute premium for lower per-day decay. Position sizing on ELMD should anchor to the underlying notional of $35.42 per share and to the trader's directional view on ELMD stock.

ELMD cash-secured put setup

The ELMD 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 ELMD near $35.42, the first option leg uses a $33.65 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ELMD 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 ELMD shares for the stock leg in covered calls and collars).

ActionTypeStrike / BasisPremium (est)
Sell 1Put$33.65N/A

ELMD 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.

ELMD cash-secured put payoff curve

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

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

ELMD thesis for this cash-secured put

The market-implied 1-standard-deviation range for ELMD extends from approximately $29.14 on the downside to $41.70 on the upside. A ELMD cash-secured put lets a trader earn premium while waiting to acquire ELMD 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 ELMD IV rank near 27.80% 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 ELMD at 61.80%. As a Healthcare name, ELMD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ELMD-specific events.

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

Frequently asked questions

What is a cash-secured put on ELMD?
A cash-secured put on ELMD is the cash-secured put strategy applied to ELMD (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 ELMD stock trading near $35.42, the strikes shown on this page are snapped to the nearest listed ELMD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ELMD 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 ELMD cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 61.80%), 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 ELMD cash-secured put?
The breakeven for the ELMD 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 ELMD market-implied 1-standard-deviation expected move is approximately 17.72%; 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 ELMD?
Cash-secured puts on ELMD earn premium while a trader waits to acquire ELMD stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning ELMD.
How does current ELMD implied volatility affect this cash-secured put?
ELMD ATM IV is at 61.80% with IV rank near 27.80%, 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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