How to Use Delta When Selling Puts: Targeting the Right Strike Price Like a Pro

Most investors sell puts without fully understanding the mechanics behind the strike price they’ve chosen. They either chase premium or aim blindly at price levels they hope make sense. But there’s a better way—one that professional options traders have relied on for decades to boost probabilities and reduce risk: Delta.

Delta isn’t just another Greek—it’s a precision tool. It helps you make informed, data-driven decisions about which puts to sell, how much risk you're taking, and what kind of return you can expect. More importantly, it allows you to choose strike prices at which you'd be comfortable owning the stock—at a discount.

Think of delta as your partner in price targeting. It helps you identify strike prices that not only offer premium income but also line up with your desired entry point for a stock. If you’ve done your fundamental homework and decided that you'd love to own a stock 10–15% lower than its current price, delta can help you find the strike with the highest odds of reaching that level—while still getting paid to wait.

In particular, selling puts with a delta around 0.30 allows you to generate premium income with a roughly 70% probability of keeping the premium without having to buy the stock. And if you do get assigned, you’re buying shares at a significant discount to the current market price. It’s a win-win scenario—especially for patient investors looking to accumulate quality stocks on their terms.

In this guide, I’ll show you how delta works, how to interpret it, and how to apply it to your next put-selling opportunity. Whether you're selling puts for income or to build a long-term stock position, delta is your edge.

What Is Delta in Options Trading?

Delta is one of the most powerful and misunderstood tools in options trading. For put sellers, it's the secret to taking control of your trade outcomes and targeting entry points with purpose.

At its core, delta measures how much an option’s price will move for every $1 move in the underlying stock. For put options:

• A delta of -0.50 means the put option will increase in value by approximately $0.50 for every $1 the stock drops.

• A delta of -0.30 suggests the option will rise by $0.30 if the stock declines by $1.

But beyond price sensitivity, delta has another key role: it provides an approximate probability that the option will finish in-the-money (ITM) at expiration. That’s the insight that makes delta so powerful for put sellers.

For example:

• A -0.50 delta put has a ~50% chance of finishing ITM. You’re essentially flipping a coin.

• A -0.30 delta put has a ~30% chance of finishing ITM—and a 70% chance of expiring worthless.

When you’re selling puts, delta allows you to align your strike price with your desired entry point for the stock and the likelihood of actually being assigned.

Want to own the stock at a deeper discount? Look at lower strike prices with deltas around 0.20. Want a balance of income and probability? A 0.30 delta strike often delivers a sweet spot.

In short, delta helps answer two critical questions:

1. What is the probability I’ll be assigned and end up owning the stock?

2. Am I comfortable owning the stock at that strike price—knowing the premium reduces my cost basis?

Delta isn’t just a number. It’s a guidepost for disciplined, data-driven entries that pay you to be patient.

Why Delta Matters When Selling Puts

When you sell a put, you're not just collecting premium—you’re also accepting the obligation to buy a stock at the strike price if it falls below that level at expiration. That obligation should be taken seriously. This is where delta comes in.

Delta offers a window into how likely it is that you’ll be assigned shares. Think of it as your risk gauge:

• A 0.50 delta put means there’s a 50% chance of being assigned. It’s essentially a coin flip.

• A 0.30 delta put suggests a 30% chance of assignment—meaning you have a 70% chance the option will expire worthless, and you’ll keep the entire premium.

• A 0.20 delta put drops the odds even further—an 80% chance the option expires without action, and only a 20% chance of being assigned.

The lower the delta, the higher the probability of a successful outcome (premium collection without assignment), but it also comes with smaller premiums. That’s the trade-off.

This is why delta matters: it helps you strike a balance between risk, reward, and conviction. You want to:

• Sell puts at strikes where you’d be happy owning the stock.

• Use delta to estimate the likelihood of getting to that entry point.

• Collect enough premium to make the trade worthwhile—whether you’re assigned or not.

Put another way, delta gives you the ability to structure high-probability trades while still targeting the companies you want to own—on your terms, and often at a 10–20% discount.

It’s not about avoiding assignment altogether. It’s about getting paid to wait for your ideal entry.

Example: Selling a Put on NVDA Using Delta

Let's apply our delta-based put-selling strategy to NVIDIA Corporation (NVDA), a leading player in the semiconductor industry. As of March 31, 2025, NVDA is trading at approximately $108.38 per share.

Assuming you aim to purchase NVDA shares at a lower price, say $99, you can utilize delta to select an appropriate put option to sell. Here's the options chain for the May 2, 2025 with 32 days to expiration:​

• $103 put: Premium of $3.80, delta of -0.34​

• $99 put: Premium of $2.56, delta of -0.25

• $95 put: Premium of $1.62, delta of -0.17​

By selling the $99 put with a delta of -0.25, you agree to buy 100 shares of NVDA at $99 if the stock drops below this price by the option's expiration. Here's the breakdown:​

• Premium Collected: $2.56 per share, totaling $256 for one contract, or 2.4% over 32 days (roughly 25% annually)

• Probability of Assignment: 29.97%

• If Assigned, Cost Basis: $99 strike price minus $2.56 premium = $96.44 per share.​

• Effective Discount from Current Price: $108.38 - $96.44 = $15.38, or approximately 11%.​

The strategy allows you to potentially acquire NVDA shares at a 11% discount from the current market price while collecting a premium that enhances your return on capital. If the stock remains above $99, you retain the $256 premium, representing an immediate yield of 2.4% (over 32 days) on the capital reserve for the potential purchase.​

By strategically selecting put options with deltas around -0.15 to -0.30, you balance the probability of assignment with the desire to purchase shares at a discounted price, all while generating additional income through premiums.

How to Choose the Right Delta When Selling Puts

Choosing the right delta when selling puts is a balancing act between risk, return, and conviction. Delta gives you the statistical foundation to structure trades with clarity and purpose—but how you apply it depends on your goals and your comfort with potential assignment.

Here’s a professional-grade framework:

• 0.15 to 0.20 Delta – Conservative, High-Probability Strategy

  • Ideal for cautious investors or those selling puts on highly volatile stocks.

  • These strikes have a 80–85% chance of expiring worthless.

  • You’re less likely to be assigned, but premiums will be lower.

  • Best when your main goal is consistent income generation with minimal ownership risk.

• 0.25 to 0.35 Delta – Balanced Risk/Reward Sweet Spot

  • Most professional put sellers operate in this zone.

  • These trades offer a solid mix of premium and probability.

  • The chance of assignment is moderate (25–35%).

  • Works well when you’re targeting a price where you’d love to own the stock and still want meaningful income if it never reaches that level.

• 0.40+ Delta – Aggressive Income with High Assignment Risk

  • Suitable for high-conviction entries or fast-moving markets.

  • Greater than 40% chance of assignment.

  • You’ll collect richer premiums, but must be fully prepared to take ownership.

When building a put-selling portfolio, consider using a blend of deltas:

• Conservative deltas for stable, income-driven trades.

• Moderate deltas where you want to acquire shares at a discount.

• Higher deltas on stocks you've researched deeply and are confident about owning.

Let delta be your compass—but conviction, risk tolerance, and margin of safety should shape the route.

Advanced Tip: Delta Adjusts With Market Moves

Delta is a dynamic number—it evolves with the market. As the stock price moves or implied volatility shifts, delta will respond in kind. That 0.25 delta put you sold? It won’t stay at 0.25 forever.

• If the stock drops closer to the strike price, delta will increase, signaling a higher probability of assignment. A 0.25 delta can quickly become a 0.40 or even 0.50 delta as the trade moves against you.

• Conversely, if the stock moves higher, delta will decrease, and your probability of assignment will fall, increasing your chances of keeping the premium.

Implied volatility (IV) also plays a role. When IV spikes, option premiums rise and delta values across the chain may shift. You may find opportunities to sell lower-delta puts for attractive premiums during high-volatility environments.

Because of this, you can’t set it and forget it. Successful put sellers monitor their deltas over time. If delta moves too far outside your comfort zone—indicating a higher-than-expected assignment risk—it may be time to:

• Roll the position down and out to a later expiration.

• Adjust the strike to maintain your desired risk profile.

• Or let it play out, if assignment aligns with your original plan.

Understanding how delta adjusts in real time helps you stay proactive instead of reactive—protecting capital and maintaining control over every position.

The Takeaway: Delta Turns Guesswork Into Strategy

Delta is more than a probability gauge—it’s a framework for disciplined decision-making. It puts you in control of how, when, and at what price you’re willing to own a stock. By using delta intentionally, you can stop chasing trades and start engineering your entries.

When you incorporate delta into your put-selling process, you:

• Set realistic expectations about probability and premium

• Control assignment risk and avoid unwanted surprises

• Target stocks at strategic entry points, often with double-digit discounts

Delta helps you shift from reactive to proactive. It moves you away from emotion and toward a structured system—one where you're always getting paid to take intelligent risks.

In short, delta elevates your approach—from taking shots in the dark to executing trades with precision and intent.

If you would like to learn more about cash-secured puts check out the following:

Why I Rarely Buy a Stock at Its Current Price: The Smarter Way to Invest

Stay focused on probabilities, not predictions.

Andy Crowder

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