To The Moon

Options have always been one of my favorite tools in the market. Instead of just buying and holding shares, I like creating opportunities to earn consistent income while positioning myself to potentially buy my favorite stocks at a discount. Recently, I sold a Palantir (PLTR) 190 Put expiring on January 16, 2026. This trade highlights how I use theta decay, delta probabilities, and cash-secured preparation to manage risk while generating returns.

$PLTR 20260116 190.0 PUT$ 

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Why I Chose the Trade 💡

Palantir has been one of the most exciting companies in the AI and data analytics space, and I see it as a long-term winner. However, I prefer to enter positions with strategies that give me a margin of safety. Instead of buying the stock outright, I sold a put contract at the $190 strike price. This means I collected a premium up front — effectively being paid to wait.

At the time of selling, the option was priced at $26.68, which translates to $2,668 per contract (since each option controls 100 shares). By selling, I immediately earned this cash, and in return, I took on the obligation to potentially buy 100 PLTR shares at $190 if assigned.

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Theta – Getting Paid by Time 🕰️💵

One of the most powerful aspects of this trade is theta decay, which is currently around 0.10 per day. In simple terms, this means the option loses about $10 in value per day (since each option is worth 100 shares), assuming all else stays constant. That daily erosion of value works in my favor as the seller.

Over weeks and months, theta can add up significantly. With 115 days left until expiration, that’s potentially over $1,000 in time decay eroding from the option’s price before it expires. Of course, volatility and price movement matter too, but theta ensures I’m consistently gaining ground as time passes.

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Delta – The Assignment Probability 🎯

The option’s delta is -0.476, which implies that the contract has about a 47.6% probability of being in the money at expiration. In plain words, there’s nearly a 50/50 chance I will end up being assigned the stock and required to buy PLTR at $190.

This probability helps me plan ahead. I don’t treat selling puts as a gamble — I treat it as a conditional buy order. If assigned, I must be ready to purchase 100 shares at the strike price. Therefore, I always keep sufficient cash in my account to cover the purchase.

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Premium Received – My Immediate Income 💰

The beauty of this strategy is the premium. By selling the put, I received about $2,668 upfront. This money is mine to keep regardless of the outcome.

If the option expires worthless (PLTR stays above $190 by January 2026), I keep the entire premium as pure profit. That’s a 14% return on the strike value in just one contract ($2,668 premium ÷ $19,000 obligation). Annualized, this works out even higher since the option expires in around 16 months.

If I do get assigned and must buy PLTR at $190, my effective cost basis becomes:

190 - 26.68 = 163.32

So instead of paying the full $190, I’d actually own PLTR at $163.32 per share. This gives me a built-in discount thanks to the premium received.

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Preparing for Assignment 🏦✅

A crucial part of selling puts is responsibility. Since there’s a 47% chance of assignment, I must prepare for the possibility of buying 100 shares at $190. That means setting aside $19,000 in cash (or margin availability) to cover the potential purchase.

I like to think of it as placing a limit buy order for PLTR at $163.32 (after premium), but instead of waiting passively, I’m getting paid $2,668 while waiting. If PLTR never drops that low, I simply pocket the income and move on.

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My Potential Outcomes 🔮📊

Here are the two main scenarios for this trade:

1. PLTR stays above $190 until expiration – The put expires worthless, and I keep the full $2,668 premium as profit. My return is 14% on the cash secured, with zero shares purchased.

2. PLTR drops below $190 and I’m assigned – I buy 100 shares at $190 but my true cost is $163.32 after subtracting the premium. I’m happy with this outcome because I wanted to own PLTR anyway, and this method gives me a cheaper entry.

In both cases, I win — either by pocketing cash or by accumulating shares at a favorable price.

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Why I Like This Strategy 📈✨

Selling puts combines the best of both worlds:

• Income generation through premiums.

• Potential long-term investment at a discount if assigned.

• Time decay (theta) working in my favor daily.

• Probability management (delta) helping me gauge assignment chances.

For me, it’s a way to stay active in the market, generate consistent cash flow, and build positions in stocks I believe in — like Palantir. I don’t see this as risky speculation, but as a disciplined method of entering trades with favorable odds.

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Final Thoughts 🌟

This PLTR 190 put trade is a great example of why I sell options. With theta decay slowly eroding the option’s value, a solid $2,668 premium already banked, and a nearly 50% chance of owning PLTR at an effective cost of $163.32, I’m comfortable with either outcome.

To me, selling puts is not just about “making money,” but about structuring my portfolio in a smart, income-generating way. Whether I keep the premium or end up holding Palantir shares, I win. That’s why this strategy remains one of my favorite tools for building wealth over time

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