TPL Cash-Secured Put Strategy
TPL (Texas Pacific Land Corporation), in the Energy sector, (Oil & Gas Exploration & Production industry), listed on NYSE.
Texas Pacific Land Corporation engages in the land and resource management, and water services and operations businesses. The company's Land and Resource Management segment manages approximately 880,000 acres of land. This segment also holds own a 1/128th nonparticipating perpetual oil and gas royalty interest (NPRI) under approximately 85,000 acres of land; a 1/16th NPRI under approximately 371,000 acres of land; and approximately 4,000 additional net royalty acres located in the western part of Texas. In addition, this segment engages in easements and commercial leases activities, such as oil, gas and related hydrocarbons, power line and utility easements, and subsurface wellbore easements. Further, this segment leases its land for processing, storage, and compression facilities and roads; and is involved in sale of materials, such as caliche. Its Water Services and Operations segment provides full-service water offerings, including water sourcing, produced-water gathering/treatment, infrastructure development, disposal solutions, water tracking, analytics, and well testing services to operators in the Permian Basin.
TPL (Texas Pacific Land Corporation) trades in the Energy sector, specifically Oil & Gas Exploration & Production, with a market capitalization of approximately $26.66B, a trailing P/E of 52.92, a beta of 0.68 versus the broader market, a 52-week range of 269.23334-547.2, average daily share volume of 543K, a public-listing history dating back to 1980, approximately 111 full-time employees. These structural characteristics shape how TPL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.68 indicates TPL has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. The trailing P/E of 52.92 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. TPL 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 TPL?
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 TPL snapshot
As of May 15, 2026, spot at $385.68, ATM IV 44.90%, IV rank 39.53%, expected move 12.87%. The cash-secured put on TPL 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 TPL specifically: TPL IV at 44.90% is mid-range versus its 1-year history, so the credit collected on a TPL cash-secured put sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 12.87% (roughly $49.65 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 TPL expiries trade a higher absolute premium for lower per-day decay. Position sizing on TPL should anchor to the underlying notional of $385.68 per share and to the trader's directional view on TPL stock.
TPL cash-secured put setup
The TPL 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 TPL near $385.68, the first option leg uses a $370.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TPL 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 TPL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $370.00 | $12.45 |
TPL cash-secured put risk and reward
- Net Premium / Debit
- +$1,245.00
- Max Profit (per contract)
- $1,245.00
- Max Loss (per contract)
- -$35,754.00
- Breakeven(s)
- $357.55
- Risk / Reward Ratio
- 0.035
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
TPL cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on TPL. 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% | -$35,754.00 |
| $85.28 | -77.9% | -$27,226.51 |
| $170.56 | -55.8% | -$18,699.03 |
| $255.83 | -33.7% | -$10,171.54 |
| $341.11 | -11.6% | -$1,644.05 |
| $426.38 | +10.6% | +$1,245.00 |
| $511.66 | +32.7% | +$1,245.00 |
| $596.93 | +54.8% | +$1,245.00 |
| $682.21 | +76.9% | +$1,245.00 |
| $767.48 | +99.0% | +$1,245.00 |
When traders use cash-secured put on TPL
Cash-secured puts on TPL earn premium while a trader waits to acquire TPL stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning TPL.
TPL thesis for this cash-secured put
The market-implied 1-standard-deviation range for TPL extends from approximately $336.03 on the downside to $435.33 on the upside. A TPL cash-secured put lets a trader earn premium while waiting to acquire TPL 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 TPL IV rank near 39.53% is mid-range against its 1-year distribution, so the IV signal is neutral; the cash-secured put thesis on TPL should anchor more to the directional view and the expected-move geometry. As a Energy name, TPL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TPL-specific events.
TPL 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. TPL positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TPL alongside the broader basket even when TPL-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on TPL carry tail risk when realized volatility exceeds the implied move; review historical TPL earnings reactions and macro stress periods before sizing. Always rebuild the position from current TPL chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on TPL?
- A cash-secured put on TPL is the cash-secured put strategy applied to TPL (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 TPL stock trading near $385.68, the strikes shown on this page are snapped to the nearest listed TPL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TPL 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 TPL cash-secured put priced from the end-of-day chain at a 30-day expiry (ATM IV 44.90%), the computed maximum profit is $1,245.00 per contract and the computed maximum loss is -$35,754.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TPL cash-secured put?
- The breakeven for the TPL cash-secured put priced on this page is roughly $357.55 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 TPL market-implied 1-standard-deviation expected move is approximately 12.87%; 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 TPL?
- Cash-secured puts on TPL earn premium while a trader waits to acquire TPL stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning TPL.
- How does current TPL implied volatility affect this cash-secured put?
- TPL ATM IV is at 44.90% with IV rank near 39.53%, 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.