A short put without the cash set aside to buy the shares; the same position as a cash-secured put but financed with margin.
The payoff is identical to a cash-secured-put. The difference is entirely about capital: a cash-secured seller has the full strike amount reserved, a naked seller has only the naked-option-requirement, which may be an eighth of it.
That leverage is the whole risk. A trader who sells eight naked puts because the margin allows it has taken on the same share exposure as someone who sold one cash-secured put with eight times the cash.
Example: XYZ at $50, sell the $45 put for $1.30. Cash-secured needs $4,500 reserved. Naked needs about $630. With $5,000 you can sell one cash-secured put or eight naked ones. If XYZ falls to $38, the naked position is short 800 shares' worth of obligation and shows a loss of roughly $4,560 on a $5,000 account.
Original diagrams for the ideas on this page. Illustrative, not real market data.
Margin and leverage. A $5,000 deposit can control a $100,000 position, which is 20:1 leverage. Because the loss is measured on the full $100,000, a 2.5% move against you halves the deposit and brings a margin call, and a 5% move uses all of it.
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