--- title: 'Most Traders Sell One Put to Get Bullish. Tom Preston Shows Why That''s 33 Deltas' source: 'https://youtube.com/watch?v=zAfFNEZiLis' video_id: 'zAfFNEZiLis' date: 2026-08-07 duration_sec: 420 channel: 'tastylive' --- # Most Traders Sell One Put to Get Bullish. Tom Preston Shows Why That's 33 Deltas > Source: [Most Traders Sell One Put to Get Bullish. Tom Preston Shows Why That's 33 Deltas](https://youtube.com/watch?v=zAfFNEZiLis) ## Summary Tom Preston explains why selling a single out-of-the-money put to express a bullish view only provides 33 deltas of exposure, not the equivalent of 100 shares of stock. He demonstrates how to scale up by selling multiple puts to match full stock delta, while weighing the trade-offs in risk, capital, and confidence. ### Key Points - **One Put = 33 Deltas** [00:03] — Selling one 33 delta put on Nvidia gives only 33 deltas of exposure, not 100 shares of stock. - **Scaling to 100 Deltas** [01:29] — To replicate 100 shares of stock, you need to sell three 33 delta puts (99 deltas total). - **Capital Requirements** [01:42] — Buying power reduction for one put is $5,200; for three puts it jumps to over $15,000. - **Dynamic Delta on Assignment** [05:01] — If the stock drops to the strike, deltas increase from 100 to 300, meaning the trader is effectively long 300 shares. - **Speculative vs. Long-Term Approach** [05:58] — For a speculative trade with less confidence, selling one put is sufficient; for long-term bullish investors, three puts may be appropriate. - **Vertical Spread Alternative** [06:11] — If capital is limited, turn the trade into a vertical spread (e.g., buy the 180 put against the 200 put) to reduce margin requirements. ## Transcript have a bullish outlook on a stock is to sell out of the money puts. Great strategy, you know, it comes into play with you know, the wheel strategy or to sell an out of the money put and if it money. If the stock goes up, I make money. But one of the questions that money. But one of the questions that comes up is how many puts should I sell? Let's Let's just take a look at an example here. Nvidia, popular stock. Let's go out to Let's go out to 45 days. And one of the questions is, so if I sell an out of the money put with a 33 delta. with a 33 delta. Uh sell the 200 put here. Not bad. Okay, I can sell I collect $740 of credit. Like that, I have a decent probability. Probability numbers I'm generating $12.69 of theta. Awesome. All those points are correct. But the point is that I'm only generating 33 deltas. I'm not getting 100 shares of stock. Is that bad? Not necessarily, but it has less risk and less opportunity than buying 100 shares of stock. Now of course, you can go out and buy 33 shares of stock if you didn't want to have that much exposure to Nvidia. But if you wanted to keep things sort of apples to apples and do a fair comparison, you'd really need to sell three of these puts. three to get the delta equal to 100. Now keep in mind that the buying power reduction on this is $5200. If I increase this to three, now I'm getting my delta up to 99. Okay. Collecting a lot bigger credit, three times the credit. My buying power effect is jumped up to 15,000, over $15,000. is jumped up to 15,000, over $15,000. So, is there a right choice here or not? Is or is there a better choice, I should say. Well, there's no right answer. Each trader has to decide for him or herself how much upside potential he or she wants, how much risk exposure he or she wants, and how much capital you want to put up for the trade. It's very simple, okay? So, if I'm really bullish on a stock and I want to replicate 100 shares of stock being long 100 shares, then selling three puts might make sense. Three 33 delta puts. Or, you know, two Or, you know, two of 250 delta puts, for example, right? To make the deltas of the position equal to 100 shares of stock. to 100 shares of stock. The dollar profit is going to be roughly the same. If the stock goes up, those puts will decay, will drop in value, and the P&L is going to be much closer. The profit on those short on three short puts is going to be much closer to the profit on 100 shares of stock than one put will. But, you have to be sufficiently bullish, sufficiently confident in your bullish sufficiently confident in your bullish outlook to sell that many puts. Okay? If long 100 deltas, great. That is obviously more confident than getting long 33 deltas. Or selling two puts for 66 deltas. So, yes, if you are very, very bullish, you're Let's say Let's say you're a long-term investor. I'm just long-term bullish on Nvidia. I want to be long 100 options. Selling three, in this case 33 delta puts, might make sense. That you would continue to it be, you know, sell them 45 days, roll them at 21, keep it rolling, rolling, rolling to the to the next next expirations 33 deltas to always maintain a 100 delta exposure to the stock. That can make sense. Especially if you have the capital to do the trade. Okay, $15,000 in this case. Now, that's still less than buying 100 shares of stock, but it's still a significant investment. If you, on the other hand, if you are not that confident, if this is a purely a speculative trade, you don't really have a very strong opinion on Nvidia. go up. I don't necessarily want to be long 100 shares of Nvidia indefinitely. I'm I'm assigned assigned on my short put, um you know, I'll sell a call against it and get out of the trade as as best I can. Which leads to the next point, if the stock does drop down to that 200 strike, your deltas are going to increase from 100 to 300. It's a much more dynamic position. Maybe you're okay with that. Maybe, you know, you say, "Well, if I wanted to if I end up buying 300 shares of stock, I end up buying 300 shares of stock." Now, there are ways around that. assigned on those short puts. You can roll them to a further expiration, for example, to avoid assignment. But still, um it is more risk. Uh you know, if the stock drops, it goes to zero, the loss on those short three puts is going to be more than 100 shares of stock, cuz they're going to turn into each short put is going to turn into 100 deltas of of stock. So, you're taking more risk. You have greater profit profit potential, but if it is a longer-term strategy, yes, um in you know, investing that much yes, um in you know, investing that much capital um and managing that trade if it goes against you, yeah, that's that's something you have to be ready for, but it might be worth it if you are very bullish on the stock. A more speculative trade, selling one put is probably enough. And if capital is an issue, if capital is an issue, we always say, "Turn it into a vertical." Don't just sell the 200 puts. I don't know. Buy the 180s against them and turn into a vertical and your margin requirements drops drop significantly. So, just pointing out some uh numbers that you might want to take a look at if you are thinking about selling puts uh to be get bullish exposure on a stock. None of this is a trade recommendation and if you do decide to use this strategy, your choice and your decision to make, but please, if you do, do not take any but please, if you do, do not take any more risk than you are comfortable with.