Monthly vs 1-Year Puts: How One Trade Made $4,000

I made a video on why I sell 1-year puts instead of monthly ones. On UNH, in the same year, my monthly puts made $741 and one 1-year put made $4,000. That put only just expired, in September 2026, so these are real, closed trades.

The video covers the big picture. This goes one level deeper: the raw trades from my statement, what would have happened if I was wrong, and the real trade-offs between the two.

1. The two trades, straight from my statement

Monthly puts. Sold a 325 put, then rolled it down four times as UNH fell.

Here's the same thing trade by trade. Each roll is two trades on the same day: buy back the old put, sell a new one.

Per contract. The realized P&L column includes commissions ($8 in total), which is why it ends at $741 instead of $749.

Every roll was a net credit, so it felt like I wasn't losing. But look at the realized column: each roll closed the old put at a loss, -$1,831 by January. The credits only made it look fine.

So where did that leave the last put, the 280? Up to the last sale on 27 Jan, I had received $7,605 and paid back $6,807. That's about $791 left in my pocket after commissions, or $7.91 per share.

If I had been assigned on that 280 put, that $7.91 lowers what I really paid: 280 - 7.91 = about $272. That's the breakeven.

UNH recovered, I closed that last one in May 2026 by buying it back for $49 (debit), and the whole thing made +$741.

The 1-year put. One trade. Sold the 320 put expiring 18 Sep 2026 for $4,000. Breakeven $280.

As you can see it expired OTM, and I get to keep all of the $4000 premium, less the $1.14 commission of course.

2. March: down $3,000 and doing nothing

On 27 March UNH hit $255.96, well below my $280 breakeven. My 1-year put was about $3,000 down on paper.

If I said I wasn't worried at all, that would be a lie. At that point there was still real uncertainty about how fast the business would recover.

But it wasn't the day-to-day panic you get when you treat a position like a trade, where you're watching for a preplanned stop loss or take profit. For me the drop was a signal to keep up with the company and check whether the investment thesis had changed.

It hadn't. $280 was still a price I'd happily own it at, and expiry was six months away, so nothing was forcing a decision. So I held. With monthly puts, a drop like that means a decision every few weeks.

3. What if I was wrong?

To compare fairly, give both the same expiry, 18 Sep 2026, and say UNH sits at $260 at expiry.

The monthly chain wouldn't just sit there. I'd keep rolling it, and deep in the money there's still decent time value to collect. In March, with UNH at $259, a 280 put with about 3 months left had roughly $11.70 a share of time value. So one more roll, June to September at the same 280 strike, could add about $1,170. That's if the market was still as nervous as in March. If things had calmed down, less.

That drops the monthly breakeven to about $260.

So in a crash that stays down, the monthly chain wins. Above about $300, the 1-year put wins, and the further the stock recovers, the bigger the gap.

4. The give and take

Neither is free. You're choosing which bad case you'd rather live with.

For me, the 1-year put works best alongside shares I already own. I use it on companies I'm bullish on long term, where I'd like to buy more if the price drops.

It's a way to get in lower without having to sit and wait for the drop first. If I'm wrong and get assigned at the breakeven, I own more of a business I like at a price I chose. And if the stock runs away from me, I still keep the 12-20% premium I collected upfront, instead of a few small monthly credits.

The crash case is one I've already accepted. The runaway case is the one that used to cost me from selling monthly put options (since i don't want to chase and get assigned at higher price).

The bottom line

Every roll on those monthly puts felt like progress. Looking back at the statement, most of it was just me staying busy.

Now I make one decision, on valuation, at a price I'd be glad to pay. Then I let time do the work.

That's all for this one.

Charlie

For educational purposes only, not financial advice or a recommendation to buy or sell any security. Past results don't guarantee future returns. Options carry real risk; do your own research or speak to a licensed advisor. I may hold positions in the securities mentioned.