The Chicago Board of Options Exchange | CBOE

Option Overlays:

  • Index Income Overlay—An overlay strategy on the sale of a put option credit spread on an S&P 500 ETF to generate additional income. A short put is sold, usually 3% out-of-the-money, and that option is paired with a long 'insurance' put, usually with a strike price 15% lower. 
  • Put Income Overlay—An overlay strategy selling puts on high quality equities to generate additional income using a concentrated equity position, bond portfolio, or other equity portfolio as collateral.