VLO Cash-Secured Put Strategy
VLO (Valero Energy Corporation), in the Energy sector, (Oil & Gas Refining & Marketing industry), listed on NYSE.
Valero Energy Corporation functions as a global producer and marketer of transportation fuels and petrochemicals, with operations spanning the United States, Canada, the United Kingdom, Ireland, and other international territories. The company organizes its business across three primary divisions: Refining, Renewable Diesel, and Ethanol. Its Refining segment generates a wide array of products, including various types of gasoline (conventional, premium, reformulated, and California Air Resources Board-compliant), diverse diesel fuels (low-sulfur, ultra-low-sulfur, and CARB diesel), jet fuels, blendstocks, asphalts, petrochemicals, and lubricants. This division also handles the sale of lube oils and natural gas liquids. As of the end of 2021, Valero managed 15 petroleum refineries, boasting a combined daily processing capacity of approximately 3.2 million barrels of crude oil. The Ethanol division comprises 12 plants, capable of producing around 1.6 billion gallons of ethanol annually.
VLO (Valero Energy Corporation) trades in the Energy sector, specifically Oil & Gas Refining & Marketing, with a market capitalization of approximately $111.60B, a trailing P/E of 15.80, a beta of 0.57 versus the broader market, a 52-week range of 155.29-419.04, average daily share volume of 3.1M, a public-listing history dating back to 1982, approximately 10K full-time employees. These structural characteristics shape how VLO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.57 indicates VLO has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. VLO 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 VLO?
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.
VLO snapshot
As of September 29, 2026, spot at $386.66, ATM IV 52.33%, IV rank 90.80%, expected move 15.00%. The cash-secured put on VLO below is built from the September 29, 2026 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 VLO specifically: VLO IV at 52.33% is rich versus its 1-year range, which favors premium-selling structures like a VLO cash-secured put, with a market-implied 1-standard-deviation move of approximately 15.00% (roughly $58.02 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 VLO expiries trade a higher absolute premium for lower per-day decay. Position sizing on VLO should anchor to the underlying notional of $386.66 per share and to the trader's directional view on VLO stock.
VLO cash-secured put setup
The VLO cash-secured put below is built from the September 29, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With VLO at $386.66 on that close, the first option leg uses a $365.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed VLO 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 VLO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Sell 1 | Put | $365.00 | $13.15 |
VLO cash-secured put risk and reward
- Net Premium / Debit
- +$1,315.00
- Max Profit (per contract)
- $1,315.00
- Max Loss (per contract)
- -$35,184.00
- Breakeven(s)
- $351.85
- Risk / Reward Ratio
- 0.037
Max profit equals premium times 100; max loss equals strike minus premium times 100 (at zero, assuming assignment). Breakeven is strike minus premium.
VLO cash-secured put payoff curve
Modeled P&L at expiration across a range of underlying prices for the cash-secured put on VLO. 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% | -$35,184.00 |
| $85.50 | -77.9% | -$26,634.84 |
| $170.99 | -55.8% | -$18,085.69 |
| $256.48 | -33.7% | -$9,536.53 |
| $341.98 | -11.6% | -$987.38 |
| $427.47 | +10.6% | +$1,315.00 |
| $512.96 | +32.7% | +$1,315.00 |
| $598.45 | +54.8% | +$1,315.00 |
| $683.94 | +76.9% | +$1,315.00 |
| $769.43 | +99.0% | +$1,315.00 |
When traders use cash-secured put on VLO
Cash-secured puts on VLO earn premium while a trader waits to acquire VLO stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning VLO.
VLO thesis for this cash-secured put
The market-implied 1-standard-deviation range for VLO extends from approximately $328.64 on the downside to $444.68 on the upside. A VLO cash-secured put lets a trader earn premium while waiting to acquire VLO 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 VLO IV rank near 90.80% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on VLO at 52.33%. As a Energy name, VLO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to VLO-specific events.
VLO 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. VLO positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move VLO alongside the broader basket even when VLO-specific fundamentals are unchanged. Short-premium structures like a cash-secured put on VLO carry tail risk when realized volatility exceeds the implied move; review historical VLO earnings reactions and macro stress periods before sizing. Always rebuild the position from current VLO chain quotes before placing a trade.
Frequently asked questions
- What is a cash-secured put on VLO?
- A cash-secured put on VLO is the cash-secured put strategy applied to VLO (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 VLO stock at $386.66 on the September 29, 2026 close, the strikes shown on this page are snapped to the nearest listed VLO chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are VLO 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 VLO cash-secured put priced from the September 29, 2026 end-of-day chain at a 30-day expiry (ATM IV 52.33%), the computed maximum profit is $1,315.00 per contract and the computed maximum loss is -$35,184.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a VLO cash-secured put?
- The breakeven for the VLO cash-secured put priced on this page is roughly $351.85 at expiration, derived from the September 29, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The VLO market-implied 1-standard-deviation expected move in the same options snapshot is approximately 15.00%; 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 VLO?
- Cash-secured puts on VLO earn premium while a trader waits to acquire VLO stock at a target strike below the current quote; most attractive when IV is rich and the trader is comfortable owning VLO.
- How does current VLO implied volatility affect this cash-secured put?
- VLO ATM IV is at 52.33% with IV rank near 90.80%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.