TKR Cash-Secured Put Strategy
TKR (The Timken Company), in the Industrials sector, (Manufacturing - Tools & Accessories industry), listed on NYSE.
The Timken Company designs, manufactures, and manages engineered bearings and power transmission products worldwide. It operates in two segments, Mobile Industries and Process Industries. The Mobile Industries segment offers a portfolio of bearings, seals, and lubrication devices and systems, as well as power transmission components, engineered chains, augers, belts, couplings, clutches, brakes, and related products and maintenance services to original equipment manufacturers (OEMs) and end-users of off-highway equipment for the agricultural, construction, mining, outdoor power equipment, and power sports markets; and on-highway vehicles, including passenger cars, light trucks, and medium- and heavy-duty trucks, as well as rail cars and locomotives. It also provides power transmission systems and flight-critical components for civil and military aircraft, which include bearings, rotor-head assemblies, helicopter transmission systems, turbine engine components, gears, and housings. This segment sells its parts through a network of authorized automotive and heavy-truck distributors to individual end-users, equipment owners, operators, and maintenance shops. The Process Industries segment provides industrial bearings and assemblies; power transmission components, such as gears and gearboxes; and linear motion products, couplings, seals, lubricants, chains, belts, and related products and services to OEMs and end-users in various industries.
TKR (The Timken Company) trades in the Industrials sector, specifically Manufacturing - Tools & Accessories, with a market capitalization of approximately $8.04B, a trailing P/E of 26.12, a beta of 1.18 versus the broader market, a 52-week range of 67.14-123.67, average daily share volume of 787K, a public-listing history dating back to 1922, approximately 19K full-time employees. These structural characteristics shape how TKR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.18 places TKR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. TKR 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 TKR?
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 TKR snapshot
As of May 15, 2026, spot at $114.65, ATM IV 37.40%, IV rank 5.03%, expected move 10.72%. The cash-secured put on TKR 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 TKR specifically: TKR IV at 37.40% is on the cheap side of its 1-year range, which means a premium-selling TKR cash-secured put collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 10.72% (roughly $12.29 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 TKR expiries trade a higher absolute premium for lower per-day decay. Position sizing on TKR should anchor to the underlying notional of $114.65 per share and to the trader's directional view on TKR stock.
TKR cash-secured put setup
The TKR 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 TKR near $114.65, the first option leg uses a $110.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TKR 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 TKR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $110.00 | $3.30 |
TKR cash-secured put risk and reward
- Net Premium / Debit
- +$330.00
- Max Profit (per contract)
- $330.00
- Max Loss (per contract)
- -$10,669.00
- Breakeven(s)
- $106.70
- Risk / Reward Ratio
- 0.031
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
TKR cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on TKR. 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% | -$10,669.00 |
| $25.36 | -77.9% | -$8,134.14 |
| $50.71 | -55.8% | -$5,599.27 |
| $76.06 | -33.7% | -$3,064.41 |
| $101.40 | -11.6% | -$529.54 |
| $126.75 | +10.6% | +$330.00 |
| $152.10 | +32.7% | +$330.00 |
| $177.45 | +54.8% | +$330.00 |
| $202.80 | +76.9% | +$330.00 |
| $228.15 | +99.0% | +$330.00 |
When traders use cash-secured put on TKR
Cash-secured puts on TKR earn premium while a trader waits to acquire TKR stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning TKR.
TKR thesis for this cash-secured put
The market-implied 1-standard-deviation range for TKR extends from approximately $102.36 on the downside to $126.94 on the upside. A TKR cash-secured put lets a trader earn premium while waiting to acquire TKR 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 TKR IV rank near 5.03% 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 TKR at 37.40%. As a Industrials name, TKR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TKR-specific events.
TKR 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. TKR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TKR alongside the broader basket even when TKR-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on TKR carry tail risk when realized volatility exceeds the implied move; review historical TKR earnings reactions and macro stress periods before sizing. Always rebuild the position from current TKR chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on TKR?
- A cash-secured put on TKR is the cash-secured put strategy applied to TKR (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 TKR stock trading near $114.65, the strikes shown on this page are snapped to the nearest listed TKR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TKR 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 TKR cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 37.40%), the computed maximum profit is $330.00 per contract and the computed maximum loss is -$10,669.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TKR cash-secured put?
- The breakeven for the TKR cash-secured put priced on this page is roughly $106.70 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 TKR market-implied 1-standard-deviation expected move is approximately 10.72%; 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 TKR?
- Cash-secured puts on TKR earn premium while a trader waits to acquire TKR stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning TKR.
- How does current TKR implied volatility affect this cash-secured put?
- TKR ATM IV is at 37.40% with IV rank near 5.03%, 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.