Why We’re Using Cash-Secured Puts on Hertz (HTZ)

By Mickelberry Capital

Not every investment needs to be a long-term equity position to be valuable.

Some opportunities are better approached through structure, patience, and defined risk rather than outright ownership. Hertz is one of those cases.

At Mickelberry Capital, we’ve chosen to engage with Hertz primarily through cash-secured puts (CSPs) — not because we’re chasing upside, but because the setup aligns with how we manage risk and income in uncertain environments.

This post explains why Hertz fits that framework.

Hertz Is a Volatile Business in a Cyclical Industry

Hertz operates in a business that is:

Capital-intensive
Highly cyclical
Sensitive to travel demand, credit conditions, and vehicle pricing

That volatility is a challenge for traditional buy-and-hold investors — but it’s exactly what creates opportunity for options sellers.

High volatility doesn’t automatically mean high risk.
It means higher premiums, if managed correctly.

Why We Prefer CSPs Over Buying the Stock

Buying Hertz stock outright requires a strong view on:

Timing
Macroeconomic conditions
Execution consistency

Selling cash-secured puts allows us to:

Get paid to wait
Define downside in advance
Only own the stock at prices we’re comfortable with

Instead of asking “Will Hertz go up?” we ask:

“Would we be comfortable owning Hertz at a lower price, and getting paid while we wait?”

If the answer is yes, CSPs become a logical tool.

Volatility Works in Favor of Premium Sellers

Hertz frequently exhibits:

Elevated implied volatility
Sharp price swings
Heavy options activity

For CSP sellers, this means:

Higher premiums relative to strike price
Wider margins of safety
Better risk-adjusted income potential

We’re not betting on perfection.
We’re structuring trades where time decay and probability do most of the work.

Downside Awareness Is Built In

Cash-secured puts are not risk-free.

If the stock falls below the strike, assignment can occur.

But that outcome is planned for, not feared.

Before entering any CSP, we evaluate:

Balance sheet health
Industry conditions
Liquidity
The price level we’d be willing to own shares

If assignment happens, we transition from premium collection to ownership — at a price we already accepted.

That’s intentional.

Why We Run Multiple CSPs Instead of One Large Position

Position sizing matters.

Rather than concentrating risk into a single large trade, we prefer:

Multiple smaller CSPs
Staggered expirations
Different strike levels

This approach:

Reduces timing risk
Smooths income
Avoids all-or-nothing outcomes

Consistency beats conviction.

This Is Not a Speculative Bet

Running CSPs on Hertz is not a bullish call on explosive growth.

It’s a measured engagement with:

Volatility
Probability
Income generation

We’re not forecasting perfect execution.
We’re structuring trades that can succeed across a range of outcomes.

That distinction matters.

How This Fits the Mickelberry Capital Framework

Our broader philosophy emphasizes:

Defined risk
Capital preservation
Probabilistic decision-making
Flexibility over prediction

Cash-secured puts on names like Hertz fit that framework better than directional bets in uncertain markets.

We don’t need to be right about everything.
We need to manage downside and stay disciplined.

Final Thought

Hertz may never be a textbook long-term compounder.

But that doesn’t mean it can’t be useful in a structured options strategy.

By using cash-secured puts, we engage with volatility on our terms — getting paid to wait, defining risk upfront, and avoiding emotional decision-making.

That’s how we prefer to operate.

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Disclosure: This content is for informational purposes only and does not constitute investment advice. All investing involves risk. Options trading involves significant risk and is not suitable for all investors. Readers should conduct their own research or consult a financial professional before making investment decisions.