ACES Covered Call Strategy
ACES (ALPS Clean Energy ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
The ALPS Clean Energy ETF, identified by the ticker ACES, aims to replicate the investment performance of its benchmark index, the CIBC Atlas Clean Energy Index (NACEX), before any fees and expenses are factored in.
ACES (ALPS Clean Energy ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $126.1M, a beta of 1.50 versus the broader market, a 52-week range of 25.28-43, average daily share volume of 93K, a public-listing history dating back to 2018. These structural characteristics shape how ACES etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.50 indicates ACES has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. ACES pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on ACES?
A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income.
Current ACES snapshot
As of June 29, 2026, spot at $34.88, ATM IV 499.30%, IV rank 100.00%, expected move 143.14%. The covered call on ACES below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 172-day expiry.
Why this covered call structure on ACES specifically: ACES IV at 499.30% is rich versus its 1-year range, which favors premium-selling structures like a ACES covered call, with a market-implied 1-standard-deviation move of approximately 143.14% (roughly $49.93 on the underlying). The 172-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ACES expiries trade a higher absolute premium for lower per-day decay. Position sizing on ACES should anchor to the underlying notional of $34.88 per share and to the trader's directional view on ACES etf.
ACES covered call setup
The ACES covered call below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With ACES near $34.88, the first option leg uses a $37.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ACES chain at a 172-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 ACES shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $34.88 | long |
| Sell 1 | Call | $37.00 | $2.50 |
ACES covered call risk and reward
- Net Premium / Debit
- -$3,238.00
- Max Profit (per contract)
- $462.00
- Max Loss (per contract)
- -$3,237.00
- Breakeven(s)
- $32.38
- Risk / Reward Ratio
- 0.143
Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium.
ACES covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on ACES. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$3,237.00 |
| $7.72 | -77.9% | -$2,465.89 |
| $15.43 | -55.8% | -$1,694.79 |
| $23.14 | -33.6% | -$923.68 |
| $30.85 | -11.5% | -$152.58 |
| $38.57 | +10.6% | +$462.00 |
| $46.28 | +32.7% | +$462.00 |
| $53.99 | +54.8% | +$462.00 |
| $61.70 | +76.9% | +$462.00 |
| $69.41 | +99.0% | +$462.00 |
When traders use covered call on ACES
Covered calls on ACES are an income strategy run on existing ACES etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
ACES thesis for this covered call
The market-implied 1-standard-deviation range for ACES extends from approximately $-15.05 on the downside to $84.81 on the upside. A ACES covered call collects premium on an existing long ACES position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether ACES will breach that level within the expiration window. Current ACES IV rank near 100.00% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on ACES at 499.30%. As a Financial Services name, ACES options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ACES-specific events.
ACES covered call positions are structurally neutral to slightly bullish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. ACES positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ACES alongside the broader basket even when ACES-specific fundamentals are unchanged. Short-premium structures like a covered call on ACES carry tail risk when realized volatility exceeds the implied move; review historical ACES earnings reactions and macro stress periods before sizing. Always rebuild the position from current ACES chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on ACES?
- A covered call on ACES is the covered call strategy applied to ACES (etf). The strategy is structurally neutral to slightly bullish: A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income. With ACES etf trading near $34.88, the strikes shown on this page are snapped to the nearest listed ACES chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ACES covered call max profit and max loss calculated?
- Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium. For the ACES covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 499.30%), the computed maximum profit is $462.00 per contract and the computed maximum loss is -$3,237.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ACES covered call?
- The breakeven for the ACES covered call priced on this page is roughly $32.38 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current ACES market-implied 1-standard-deviation expected move is approximately 143.14%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a covered call on ACES?
- Covered calls on ACES are an income strategy run on existing ACES etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
- How does current ACES implied volatility affect this covered call?
- ACES ATM IV is at 499.30% with IV rank near 100.00%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.