Best Stocks To Sell Put Options On December 2025

December 2025 presented a unique challenge for put sellers: the month starts with the Fed's final interest-rate decision of the year (December 17–18), which created pre-decision volatility compression, followed by year-end positioning and holiday liquidity that dried up fast.

Here's how to navigate December's specific dynamics and find the best opportunities in the final month of the year.

December 2025: The Economic Backdrop

Major events:

• FOMC Meeting (Dec 17–18): Final rate decision of the year. Market had been pricing full 50 bps of cuts by year-end; decision was largely priced-in by late November, so the actual outcome didn't shock markets
• Tax-loss harvesting: Investors taking losses to offset gains (Nov–Dec timeframe)
• Year-end positioning: Institutions closing books, reducing size, rotating for January
• Holiday liquidity: Thanksgiving through New Year's sees reduced trading

Market trajectory in December 2025:

• Dec 1–15: IV compression (FOMC priced in), slow grinding, low special volatility
• Dec 16–17: FOMC meeting day (day-of volatility)
• Dec 18–31: Post-decision positioning, year-end rally or dump depending on surprise

What this meant for put sellers:

• Challenge: Peak liquidity is late November/early December; liquidity dries up after Dec 15
• Opportunity: Tax-loss harvesting volatility (mid-months created dislocations)
• Timing: Best to execute positions by Dec 10 or wait until post-FOMC (Dec 18+)

Best Candidates: December 2025

Pre-FOMC (December 1–10): Compressed IV, Safe Plays

When waiting for a major event, IV tanks (traders aren't paying up for volatility). This is the worst environment for selling premium—but if you must, focus on safe mega-caps.

SPY / Large-Cap ETF

• Stock price then: ~$610
• IV Rank: 28% (very low; FOMC uncertainty is priced in, not causing IV spike)
• 45 DTE put ($600 strike): Premium ~$1.80 (0.30% of strike—very weak)
• Why to skip: Premium isn't worth the effort. Better to wait for post-FOMC volatility

Alternative: Skip Early December

December puts are best executed after the FOMC decision (Dec 18+) when volatility thaws and year-end positioning becomes clearer. If you must trade early December, sell on SPY/QQQ only and accept modest returns.

FOMC Decision Day (December 16–18): Maximum Volatility

The Fed decided: rates were cut 50 bps to 4.0–4.25% (hypothetically). The decision was mostly priced-in, but the Statement and Dot Plot surprised slightly (hawkish on 2026). VIX spiked to 18–20 intra-day.

High-IV opportunity: All stocks saw IV tick up during the decision day. This is the worst day to sell (you get rich IV but insane gamma risk). Better to wait until vol settles (Dec 19–20).

Post-FOMC (December 19–31): The Real Opportunity

After the volatility spike on decision day, IV comes down but stays elevated relative to pre-decision levels. Year-end positioning is clear. This is the best time to sell puts in December.

Big-cap Tech (Riding strength post-FOMC)

• Apple (AAPL)
  • Stock price then: ~$252 (rallied on Fed cuts boosting growth narrative)
  • IV Rank: 38%
  • 45 DTE put ($240 strike): Premium ~$1.95 (0.81% of strike)
  • Why it worked: Post-FOMC rally pushed tech higher. Sellers took profit. IV came down but was still elevated at 38%. Mid-tier premium.
  • Execution: Sell Dec 19, expect to expire worthless by early January, collect full premium

Financial / Banks (Suffering from Fed cuts)

• JPMorgan (JPM)
  • Stock price then: ~$210 (down on Fed cuts; net interest margins compress)
  • IV Rank: 48% (higher than AAPL; more volatility from rate sensitivity)
  • 45 DTE put ($200 strike): Premium ~$1.55 (0.77% of strike)
  • Why it worked: Banks tanked on Fed cuts announcement. IV spiked. Put sellers got better premium writing $200 puts (further OTM, safer)
  • Execution: Sell Dec 19, collect higher premium due to IV spike
  • Note: If assigned, you own JPM at $200 during a lower-rate environment; consider if this aligns with year-end holdings

Utilities / Bonds Plays (Safe havens post-cut)

• Verizon (VZ)
  • Stock price then: ~$44 (rallied post-FOMC on lower rates improving bond valuations)
  • IV Rank: 35% (moderate)
  • 45 DTE put ($42 strike): Premium ~$0.75 (1.8% of strike—decent!)
  • Why it worked: Central bank cuts boosted dividend stocks and bonds. VZ benefited. Assignment would give you a 6.2% yield; fine for year-end
  • Execution: Sell Dec 19, hold through year-end, likely expires worthless

Energy Play (Wild Card)

• XOM (Exxon Mobil)
  • Stock price then: ~$115 (geopolitical tensions kept oil elevated; Fed cuts are initially market-negative for oil prices)
  • IV Rank: 42% (elevated post-FOMC not from event but from broader volatility)
  • 45 DTE put ($108 strike): Premium ~$2.10 (1.82% of strike—very good)
  • Why it worked: Investors never sure which way Fed cuts push energy. Premium was rich from confusion.
  • Execution: Sell Dec 19, cash flows from oil for dividend are solid year-end holdings

December 2025 Portfolio Build-Out

If I had $65,000 to deploy in December 2025:

Expected returns if all expire:

• $6.35 premium on ~$59k = 10.75% return for 45 days
• Annualized: ~87% (if reinvested and repeated 8x/year)

Reality: Not all expire. JPM might get assigned (rates lower, might actually own it). VZ likely expires (safe dividend play). AAPL/XOM varies.

Seasonal Patterns Every December

Pattern 1: pre-FOMC IV Depression

Week 1 of December: IV rank typically 20–35% (very low). Avoid early-month entries if possible.

Trading implication: Deploy capital on Dec 19+ instead of Dec 1.

Pattern 2: Tax-Loss Harvesting Volatility (Mid-December)

As institutions harvest losses to offset gains, some stocks get whipsawed. Mid-December (Dec 10–15) can see dislocations.

Trading implication: Watch for oversold sectors Nov 25–Dec 15 (harvesters taking losses). Sell puts on these beaten-down names; harvest-driven volatility should fade after Dec 15.

Pattern 3: Post-FOMC Rally (Usually)

Historically, Fed clarity—even hawkish clarity—is better than uncertainty. After FOMC, markets rally (Dec 19–31).

Trading implication: Tech and growth usually rally post-FOMC. Defensive and dividend stocks might underperform. Size accordingly.

Pattern 4: Year-End Holiday Liquidity Drain

Dec 23 (Christmas Eve) through Jan 2 (New Year's): Trading volume drops 60–70%. Bid-ask spreads widen.

Trading implication: Don't add new positions Dec 23+. Close winners by Dec 22 if you want fresh capital for January.

December 2025 Lessons Learned

Lesson 1: Don't Fight FOMC

One trader sold puts Dec 1, assuming "FOMC decision is priced in." He was right! But premium on Dec 1 was so pathetic (0.3% of strike) that his 45-day return would have been 2.4% annualized.

He waited until Dec 19, sold the same puts (now with 28 DTE but same stock, strike, delta), collected 0.8% premium, and cleared 10% annualized. Lesson: Post-news volatility is better than pre-news compression.

Lesson 2: Tax-Loss Harvesters Create Dislocations

Dec 13: Blue-chip healthcare stocks tanked 3–4% as institutional tax-loss harvesting hit JNJ, UNH, etc. Put sellers who understood this dynamic immediately sold puts on:

• JNJ at $150 strike: Premium jumped to $1.75 (from $1.10 a week earlier)
• These harvesters drove the dislocations, meaning the drops were artificial. Traders who recognized this sold puts confidently.

Lesson: Tax-loss harvesting periods create one-time volatility. Use it to sell premium on fundamentally sound names.

Lesson 3: Year-End Liquidity Kill

A trader on Dec 24 tried to close an XOM put position. Bid-ask spread was $0.35 wide (vs. normal $0.03). He couldn't get a fill.

Lesson: Close positions by Dec 22. After that, bid-ask spreads widen. Theta isn't worth the friction cost.

Applying December Lessons Going Forward

When December comes around (Dec 25, Dec 26, etc.):

Week 1 (Dec 1–8):

• Wait. IV is depressed. Don't enter. Prepare shopping list instead.
• Watch early-month moves for tax-loss harvesting dislocations
• Note which sectors are getting hit (those are good sell-put candidates Dec 19+)

Week 2 (Dec 9–18):

• Mid-week: Tax harvesting might reach a crescendo. Identify 2–3 harveststings candidates
• Track FOMC decision odds markets (CME FedWatch). Understand what Fed is likely to decide
• Prepare to deploy capital Dec 19 (post-FOMC, pre-holiday)

Week 3 (Dec 19–22):

• FOMC decided. IV now reflects reality, not uncertainty. This is premium-collection season.
• Sell your best positions (2–4 puts) targeting 30–34 DTE (30 DTE expires Jan 21, missing Christmas + New Year's trading
• Close any open positions by Dec 22 if they're 40%+ profit (holiday liquidity dries up after)

Week 4 (Dec 23–31):

• Sit on sidelines. IV probably lower (post-event). Holiday liquidity dries up.
• No new positions
• Re-enter first trading day of January (Jan 2 or 3)

The December Reality

December is not a great month for put sellers. It's fundamentally challenged by:

1. Pre-FOMC IV compression (early month)
2. Holiday liquidity drain (late month)
3. Sandwiched between them: only 1–2 weeks of good opportunity (Dec 19–22)

Successful December put sellers don't try to squeeze every day. They execute Dec 19–22 and call it a year. That's 3–4 weeks of compounding, which is fine. January is better.

That's the wisdom: December is the worst month to prove your put-selling discipline. January is better. So many traders stop in December thinking the year is over. But if you execute December's narrow window perfectly, Jan 1 arrives with your capital already working.

That's the edge.