Subject: Re: brk, sold cash secured puts on Friday
For example, you own BRK.B right now, current price $495/share. You can buy the March '26 $490 put for $27 (ish) and sell the March '26 $540 call for maybe slightly more than that. Ultimately, you can put that trade on for a small credit and you can still capture up to $45 or 9.1% worth of upside with max 1% downside should the market crash.

I don't quite see how this trade works. If you buy the March '26 490 put at $27 and you sell the March '26 540 call at $27 (let's say roughly zero credit or debit), then come March '26, if the stock price is:

420 - put is worth $70, call is worthless, you earn $70 when you sell that put.
450 - put is $40, call is zero, you earn $40 when you sell that put.
490 - put is $0, call is $0, all expire worthless, you're roughly even.
540 - put is 0, call is 0, all expire worthless, you're roughly even.
600 - put is 0, call is $60, you buy that call back at a total loss of $60.

If you look at the profile of this trade, it is essentially a bearish trade where you only gain if the stock goes down to 490 or lower in March of 2026. So it's a kind of hedge on a big drop, while giving up any gains above 540 in return. And 540 is only about 9% higher than current price, so there is some probability of being there in a year. Is this what you intend on doing with this trade?

You can also manipulate this such that you only owe long term capital gains should the trade work out and you don't have to deal with the tax implications of selling your stock.

If you do not sell the stock (i.e. are not assigned an exercise), then the gains on the short call are ALWAYS considered to be short-term gains. The same applies to a short put.

There is a -very- slight risk that BRK rallies extremely hard and your short calls are exercised.
It would be quite unusual for those calls to be exercised anytime before the end date. That's because it doesn't make economic sense - it would be better to sell the call rather than exercise it because then you gain the intrinsic value plus the small remaining time value (and even one day before expiry there is some time value). However, it does happen rarely (very rarely, I can count on one hand how many times it has happened to me over the last ~40 years of trading options). I was delighted a few months ago when someone exercised some of my options early and vaporized all of the time value in them.