FRMI Cash-Secured Put Strategy
FRMI (Fermi Inc. Common Stock), in the Utilities sector, (Regulated Electric industry), listed on NASDAQ.
Fermi, Inc. engages in the development of energy infrastructure. It intends to develop an energy and data center development campus to support the needs of to-be-built AI infrastructure. The company was founded by Rick Perry, Toby Neugebauer and Griffin Perry on January 10, 2025 and is headquartered in Amrillo, TX.
FRMI (Fermi Inc. Common Stock) trades in the Utilities sector, specifically Regulated Electric, with a market capitalization of approximately $3.83B, a beta of 1.51 versus the broader market, a 52-week range of 4.47-36.99, average daily share volume of 13.3M, a public-listing history dating back to 2025, approximately 1 full-time employees. These structural characteristics shape how FRMI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.51 indicates FRMI has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a cash-secured put on FRMI?
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 FRMI snapshot
As of May 15, 2026, spot at $6.49, ATM IV 126.42%, IV rank 4.45%, expected move 36.25%. The cash-secured put on FRMI 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 28-day expiry.
Why this cash-secured put structure on FRMI specifically: FRMI IV at 126.42% is on the cheap side of its 1-year range, which means a premium-selling FRMI cash-secured put collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 36.25% (roughly $2.35 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated FRMI expiries trade a higher absolute premium for lower per-day decay. Position sizing on FRMI should anchor to the underlying notional of $6.49 per share and to the trader's directional view on FRMI stock.
FRMI cash-secured put setup
The FRMI 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 FRMI near $6.49, the first option leg uses a $6.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FRMI chain at a 28-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 FRMI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $6.00 | $0.58 |
FRMI cash-secured put risk and reward
- Net Premium / Debit
- +$57.50
- Max Profit (per contract)
- $57.50
- Max Loss (per contract)
- -$541.50
- Breakeven(s)
- $5.43
- Risk / Reward Ratio
- 0.106
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
FRMI cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on FRMI. 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 | -99.8% | -$541.50 |
| $1.44 | -77.8% | -$398.11 |
| $2.88 | -55.7% | -$254.73 |
| $4.31 | -33.6% | -$111.34 |
| $5.75 | -11.5% | +$32.05 |
| $7.18 | +10.6% | +$57.50 |
| $8.61 | +32.7% | +$57.50 |
| $10.05 | +54.8% | +$57.50 |
| $11.48 | +76.9% | +$57.50 |
| $12.91 | +99.0% | +$57.50 |
When traders use cash-secured put on FRMI
Cash-secured puts on FRMI earn premium while a trader waits to acquire FRMI stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning FRMI.
FRMI thesis for this cash-secured put
The market-implied 1-standard-deviation range for FRMI extends from approximately $4.14 on the downside to $8.84 on the upside. A FRMI cash-secured put lets a trader earn premium while waiting to acquire FRMI 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 FRMI IV rank near 4.45% 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 FRMI at 126.42%. As a Utilities name, FRMI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FRMI-specific events.
FRMI 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. FRMI positions also carry Utilities sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FRMI alongside the broader basket even when FRMI-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on FRMI carry tail risk when realized volatility exceeds the implied move; review historical FRMI earnings reactions and macro stress periods before sizing. Always rebuild the position from current FRMI chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on FRMI?
- A cash-secured put on FRMI is the cash-secured put strategy applied to FRMI (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 FRMI stock trading near $6.49, the strikes shown on this page are snapped to the nearest listed FRMI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FRMI 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 FRMI cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 126.42%), the computed maximum profit is $57.50 per contract and the computed maximum loss is -$541.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FRMI cash-secured put?
- The breakeven for the FRMI cash-secured put priced on this page is roughly $5.43 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 FRMI market-implied 1-standard-deviation expected move is approximately 36.25%; 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 FRMI?
- Cash-secured puts on FRMI earn premium while a trader waits to acquire FRMI stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning FRMI.
- How does current FRMI implied volatility affect this cash-secured put?
- FRMI ATM IV is at 126.42% with IV rank near 4.45%, 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.