Jade Lizard Calculator

A jade lizard sells a put below the current price and a call spread above it, all on the same expiry. The credit collected is larger than the width of the call spread, so there is no loss on the upside at all: if the stock rallies through both call strikes the position still keeps the difference. The risk is on the downside, where the short put behaves like a short put.

When it is used

Traders sell jade lizards when implied volatility is high and they are neutral to slightly bullish. It is a way to sell premium with no upside risk and a wide profit zone, in exchange for the same downside exposure as a cash-secured put. The call spread is placed above a resistance level and sized so the total credit exceeds its width.

How it makes and loses money

Time decay and falling implied volatility are the engine. The stock finishing anywhere between the put strike and the short call strike earns the full credit. A fall below the put's breakeven loses one for one. A rally reduces the profit to the credit minus the spread width, which is still positive by construction.

What to check in the grid

Check the top rows to confirm there is no loss there; if there is, the credit was less than the spread width and the position is not a jade lizard. Then look at the rows below the put strike, where the position is as exposed as a short put.