OTIS Cash-Secured Put Strategy
OTIS (Otis Worldwide Corporation), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.
Otis Worldwide Corporation manufactures, installs, and services elevators and escalators in the United States, China, and internationally. The company operates in two segments, New Equipment and Service. The New Equipment segment designs, manufactures, sells, and installs a range of passenger and freight elevators, as well as escalators and moving walkways for residential and commercial buildings, and infrastructure projects. The Service segment performs maintenance and repair services, as well as modernization services to upgrade elevators and escalators. It had a network of approximately 34,000 service mechanics operating approximately 1,400 branches and offices. The company was founded in 1853 and is headquartered in Farmington, Connecticut.
OTIS (Otis Worldwide Corporation) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $28.10B, a trailing P/E of 19.19, a beta of 0.94 versus the broader market, a 52-week range of 72.51-101.42, average daily share volume of 3.9M, a public-listing history dating back to 2020, approximately 72K full-time employees. These structural characteristics shape how OTIS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.94 places OTIS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. OTIS 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 OTIS?
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 OTIS snapshot
As of May 15, 2026, spot at $70.96, ATM IV 25.50%, IV rank 67.51%, expected move 7.31%. The cash-secured put on OTIS 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 OTIS specifically: OTIS IV at 25.50% is mid-range versus its 1-year history, so the credit collected on a OTIS cash-secured put sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 7.31% (roughly $5.19 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 OTIS expiries trade a higher absolute premium for lower per-day decay. Position sizing on OTIS should anchor to the underlying notional of $70.96 per share and to the trader's directional view on OTIS stock.
OTIS cash-secured put setup
The OTIS 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 OTIS near $70.96, the first option leg uses a $67.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed OTIS 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 OTIS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $67.50 | $0.88 |
OTIS cash-secured put risk and reward
- Net Premium / Debit
- +$87.50
- Max Profit (per contract)
- $87.50
- Max Loss (per contract)
- -$6,661.50
- Breakeven(s)
- $66.63
- Risk / Reward Ratio
- 0.013
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
OTIS cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on OTIS. 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% | -$6,661.50 |
| $15.70 | -77.9% | -$5,092.65 |
| $31.39 | -55.8% | -$3,523.79 |
| $47.08 | -33.7% | -$1,954.94 |
| $62.76 | -11.5% | -$386.08 |
| $78.45 | +10.6% | +$87.50 |
| $94.14 | +32.7% | +$87.50 |
| $109.83 | +54.8% | +$87.50 |
| $125.52 | +76.9% | +$87.50 |
| $141.21 | +99.0% | +$87.50 |
When traders use cash-secured put on OTIS
Cash-secured puts on OTIS earn premium while a trader waits to acquire OTIS stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning OTIS.
OTIS thesis for this cash-secured put
The market-implied 1-standard-deviation range for OTIS extends from approximately $65.77 on the downside to $76.15 on the upside. A OTIS cash-secured put lets a trader earn premium while waiting to acquire OTIS 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 OTIS IV rank near 67.51% is mid-range against its 1-year distribution, so the IV signal is neutral; the cash-secured put thesis on OTIS should anchor more to the directional view and the expected-move geometry. As a Industrials name, OTIS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to OTIS-specific events.
OTIS 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. OTIS positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move OTIS alongside the broader basket even when OTIS-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on OTIS carry tail risk when realized volatility exceeds the implied move; review historical OTIS earnings reactions and macro stress periods before sizing. Always rebuild the position from current OTIS chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on OTIS?
- A cash-secured put on OTIS is the cash-secured put strategy applied to OTIS (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 OTIS stock trading near $70.96, the strikes shown on this page are snapped to the nearest listed OTIS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are OTIS 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 OTIS cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 25.50%), the computed maximum profit is $87.50 per contract and the computed maximum loss is -$6,661.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a OTIS cash-secured put?
- The breakeven for the OTIS cash-secured put priced on this page is roughly $66.63 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 OTIS market-implied 1-standard-deviation expected move is approximately 7.31%; 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 OTIS?
- Cash-secured puts on OTIS earn premium while a trader waits to acquire OTIS stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning OTIS.
- How does current OTIS implied volatility affect this cash-secured put?
- OTIS ATM IV is at 25.50% with IV rank near 67.51%, 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.