Trade of the day $MSTR
Grabbing the Monster by the Blz
Trade Analysis: Short $MSTR 215 Put (Nov 21 2025, 11 DTE)
this is a short-dated naked put sale on $MSTR (MicroStrategy), expiring Nov 21 2025 (11 days to expiry), strike 215, premium ≈ $5.30, IV ≈ 85 %, delta ≈ -0.24.
💡 Rationale & Benefits
High IV Premium: MSTR volatility is rich (85 %), making short premium plays attractive.
Favorable Probabilities: Delta -0.24 → ~76 % POP within 11 days.
Defined Entry Target: Willing to own MSTR near $ 210 – a ~6 % discount from spot.
Theta Harvest: Short-term puts decay fast; each day of sideways price brings income.
Capital Efficiency: Reg-T margin ≈ $ 1.6 k → annualized return potential > 30 % if done consistently.
⚠️ Risks & Considerations
Directional Risk: If MSTR drops below 209.7 by expiration, losses begin to mirror long stock.
Event/Vol Risk: Any sudden selloff in Bitcoin or NASDAQ tech names can amplify MSTR swings.
Assignment Risk: If price < 215 on expiration Friday, shares may be assigned at $ 215.
Gap Risk: Limited time (11 days) means no room to adjust if a sharp drop occurs.
Undefined Risk: Naked put = theoretically unlimited downside to zero. Use size control or protective hedge (e.g. buy 200 put for cheap insurance).
🧭 Management Guidelines
Profit-Target: Buy back when 50–70 % of max profit is captured ($ 2.65–$ 1.60 to close).
Stop/Defense: If MSTR breaks below 210 or IV spikes > 95 %, consider rolling down/out to Dec or adding a protective leg.
Conversion to Stock: If assigned, treat as synthetic entry at $ 209.70 basis and consider covered-call overlay.
MicroStrategy’s stock ($MSTR) remains volatile with implied volatility hovering around 85 %. For option sellers, that’s a golden setup. This week we’re taking advantage of the rich premium by selling the Nov 21 215 put for $5.30. It’s an 8-point OTM strike with a -0.24 delta and roughly a 76 % probability of profit.
Why we like it: With just 11 days to go, time decay works fast in our favor. We’re essentially agreeing to buy MSTR at an effective cost basis of $ 209.70 (215 – 5.30), about 6 % below the current price. If the stock stays above 215, we keep the entire $530 premium for the contract. If it dips, we’re comfortable owning shares of a strong Bitcoin-leveraged play at a discount.
Risk management: Because this is an undefined-risk trade, position sizing is key. Each contract carries ~$20.9 k notional risk but only $1.6 k margin requirement. If MSTR trades below 210 or vol explodes, we’ll roll to a later expiry or buy a cheap 200 put to define risk.
Bottom line: This short-term put sale offers a high probability income play in a high-IV environment. We earn ~$530 for 11 days of exposure with a defined plan to manage the position if MSTR slips below 210.