KTOS Cash-Secured Put Strategy
KTOS (Kratos Defense & Security Solutions, Inc.), in the Industrials sector, (Aerospace & Defense industry), listed on NASDAQ.
Kratos Defense & Security Solutions, Inc. primarily functions as a contractor for the United States Department of Defense. Its business operations are organized into two distinct divisions: Kratos Government Solutions and Unmanned Systems. The Kratos Government Solutions segment delivers a comprehensive suite of products and services, including advanced microwave electronics, solutions for space and satellite communications, specialized training and cybersecurity/warfare capabilities, C5ISR (Command, Control, Communications, Computers, Combat Systems, Intelligence, Surveillance, and Reconnaissance) and modular systems, cutting-edge turbine technologies, and essential defense and rocket support services. Meanwhile, the Unmanned Systems division is dedicated to developing and supplying autonomous platforms, specifically unmanned aerial, ground, and maritime systems. Kratos caters to an extensive client base, which includes various national security organizations, the DoD, intelligence and classified agencies, international government bodies, and both domestic and global commercial enterprises. The company was established in 1994 and its corporate headquarters are located in San Diego, California.
KTOS (Kratos Defense & Security Solutions, Inc.) trades in the Industrials sector, specifically Aerospace & Defense, with a market capitalization of approximately $8.85B, a trailing P/E of 283.90, a beta of 1.03 versus the broader market, a 52-week range of 41.87-134, average daily share volume of 4.7M, a public-listing history dating back to 1999, approximately 4K full-time employees. These structural characteristics shape how KTOS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.03 places KTOS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 283.90 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple.
What is a cash-secured put on KTOS?
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 KTOS snapshot
As of June 30, 2026, spot at $49.72, ATM IV 70.49%, IV rank 53.21%, expected move 20.21%. The cash-secured put on KTOS 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 KTOS specifically: KTOS IV at 70.49% is mid-range versus its 1-year history, so the credit collected on a KTOS cash-secured put sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 20.21% (roughly $10.05 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 KTOS expiries trade a higher absolute premium for lower per-day decay. Position sizing on KTOS should anchor to the underlying notional of $49.72 per share and to the trader's directional view on KTOS stock.
KTOS cash-secured put setup
The KTOS 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 KTOS near $49.72, the first option leg uses a $47.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KTOS 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 KTOS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $47.00 | $2.85 |
KTOS cash-secured put risk and reward
- Net Premium / Debit
- +$285.00
- Max Profit (per contract)
- $285.00
- Max Loss (per contract)
- -$4,414.00
- Breakeven(s)
- $44.15
- Risk / Reward Ratio
- 0.065
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
KTOS cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on KTOS. 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% | -$4,414.00 |
| $11.00 | -77.9% | -$3,314.77 |
| $21.99 | -55.8% | -$2,215.55 |
| $32.99 | -33.7% | -$1,116.32 |
| $43.98 | -11.5% | -$17.10 |
| $54.97 | +10.6% | +$285.00 |
| $65.96 | +32.7% | +$285.00 |
| $76.96 | +54.8% | +$285.00 |
| $87.95 | +76.9% | +$285.00 |
| $98.94 | +99.0% | +$285.00 |
When traders use cash-secured put on KTOS
Cash-secured puts on KTOS earn premium while a trader waits to acquire KTOS stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning KTOS.
KTOS thesis for this cash-secured put
The market-implied 1-standard-deviation range for KTOS extends from approximately $39.67 on the downside to $59.77 on the upside. A KTOS cash-secured put lets a trader earn premium while waiting to acquire KTOS 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 KTOS IV rank near 53.21% is mid-range against its 1-year distribution, so the IV signal is neutral; the cash-secured put thesis on KTOS should anchor more to the directional view and the expected-move geometry. As a Industrials name, KTOS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KTOS-specific events.
KTOS 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. KTOS positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KTOS alongside the broader basket even when KTOS-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on KTOS carry tail risk when realized volatility exceeds the implied move; review historical KTOS earnings reactions and macro stress periods before sizing. Always rebuild the position from current KTOS chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on KTOS?
- A cash-secured put on KTOS is the cash-secured put strategy applied to KTOS (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 KTOS stock trading near $49.72, the strikes shown on this page are snapped to the nearest listed KTOS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KTOS 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 KTOS cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 70.49%), the computed maximum profit is $285.00 per contract and the computed maximum loss is -$4,414.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KTOS cash-secured put?
- The breakeven for the KTOS cash-secured put priced on this page is roughly $44.15 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 KTOS market-implied 1-standard-deviation expected move is approximately 20.21%; 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 KTOS?
- Cash-secured puts on KTOS earn premium while a trader waits to acquire KTOS stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning KTOS.
- How does current KTOS implied volatility affect this cash-secured put?
- KTOS ATM IV is at 70.49% with IV rank near 53.21%, 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.