How are AMDD 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 AMDD covered call priced from the November 13, 2026 end-of-day chain at a 30-day expiry (ATM IV 68.60%), the computed maximum profit is $248.50 per contract and the computed maximum loss is -$2,150.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a AMDD covered call?

The breakeven for the AMDD covered call priced on this page is roughly $21.52 at expiration, derived from the November 13, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The AMDD market-implied 1-standard-deviation expected move in the same options snapshot is approximately 19.67%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current AMDD implied volatility affect this covered call?

AMDD ATM IV is at 68.60% with IV rank near 28.94%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

AMDD Covered Call Strategy

AMDD (Direxion Daily AMD Bear 1X ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on NASDAQ.

These Direxion ETFs, the Daily AMD Bull 2X and Daily AMD Bear 1X, aim for specific daily investment results, prior to fees and expenses: the Bull fund targets twice (200%) the performance of Advanced Micro Devices, Inc. (NASDAQ: AMD) common shares, while the Bear fund endeavors to achieve 100% of the inverse (opposite) performance of the same shares.

AMDD (Direxion Daily AMD Bear 1X ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $14.7M, a beta of -2.71 versus the broader market, a 52-week range of 20.82-105.8, average daily share volume of 673K, a public-listing history dating back to 2025. These structural characteristics shape how AMDD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of -2.71 indicates AMDD has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. AMDD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a covered call on AMDD?

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.

AMDD snapshot

As of November 13, 2026, spot at $23.14, ATM IV 68.60%, IV rank 28.94%, expected move 19.67%. The covered call on AMDD below is built from the November 13, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.

Why this covered call structure on AMDD specifically: AMDD IV at 68.60% is on the cheap side of its 1-year range, which means a premium-selling AMDD covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 19.67% (roughly $4.55 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AMDD expiries trade a higher absolute premium for lower per-day decay. Position sizing on AMDD should anchor to the underlying notional of $23.14 per share and to the trader's directional view on AMDD etf.

AMDD covered call setup

The AMDD covered call below is built from the November 13, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With AMDD at $23.14 on that close, the first option leg uses a $24.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AMDD chain at a 35-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 AMDD shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$23.14	long
Sell 1	Call	$24.00	$1.63

AMDD covered call risk and reward

Net Premium / Debit: -$2,151.50
Max Profit (per contract): $248.50
Max Loss (per contract): -$2,150.50
Breakeven(s): $21.52
Risk / Reward Ratio: 0.116

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.

AMDD covered call payoff curve

Modeled P&L at expiration across a range of underlying prices for the covered call on AMDD. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$2,150.50
$5.13	-77.9%	-$1,638.97
$10.24	-55.7%	-$1,127.44
$15.36	-33.6%	-$615.92
$20.47	-11.5%	-$104.39
$25.59	+10.6%	+$248.50
$30.70	+32.7%	+$248.50
$35.82	+54.8%	+$248.50
$40.93	+76.9%	+$248.50
$46.05	+99.0%	+$248.50

When traders use covered call on AMDD

Covered calls on AMDD are an income strategy run on existing AMDD etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.

AMDD thesis for this covered call

The market-implied 1-standard-deviation range for AMDD extends from approximately $18.59 on the downside to $27.69 on the upside. A AMDD covered call collects premium on an existing long AMDD position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether AMDD will breach that level within the expiration window. Current AMDD IV rank near 28.94% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on AMDD at 68.60%. As a Financial Services name, AMDD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AMDD-specific events.

AMDD 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. AMDD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AMDD alongside the broader basket even when AMDD-specific fundamentals are unchanged. Short-premium structures like a covered call on AMDD carry tail risk when realized volatility exceeds the implied move; review historical AMDD earnings reactions and macro stress periods before sizing. Always rebuild the position from current AMDD chain quotes before placing a trade.

Frequently asked questions

What is a covered call on AMDD?: A covered call on AMDD is the covered call strategy applied to AMDD (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 AMDD etf at $23.14 on the November 13, 2026 close, the strikes shown on this page are snapped to the nearest listed AMDD chain strike and the premiums come straight from that session's bid/ask midpoint.
How are AMDD 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 AMDD covered call priced from the November 13, 2026 end-of-day chain at a 30-day expiry (ATM IV 68.60%), the computed maximum profit is $248.50 per contract and the computed maximum loss is -$2,150.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a AMDD covered call?: The breakeven for the AMDD covered call priced on this page is roughly $21.52 at expiration, derived from the November 13, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The AMDD market-implied 1-standard-deviation expected move in the same options snapshot is approximately 19.67%; 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 AMDD?: Covered calls on AMDD are an income strategy run on existing AMDD 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 AMDD implied volatility affect this covered call?: AMDD ATM IV is at 68.60% with IV rank near 28.94%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.