What is the breakeven point for selling a PUT option?

The breakeven point for selling a put option is calculated by taking the strike price and subtracting the premium received from selling the put. This is because the seller of the put option is obligated to buy the underlying asset at the strike price if the option is exercised. Therefore, if the market price of the underlying asset drops below the strike price, the seller could face a loss.

To find the breakeven point, you need to determine the price at which the overall loss for the seller is zero. By subtracting the premium from the strike price, you find that any market price above this breakeven point would mean that the seller profits, while a market price below it would indicate a loss. Essentially, the premium received offsets some of the potential loss from owning the asset at the higher strike price.

Thus, the correct method to arrive at the breakeven point when selling a put option is indeed to subtract the premium from the strike price.