BIS Covered Call Strategy
BIS (ProShares - UltraShort Nasdaq Biotechnology), in the Financial Services sector, (Asset Management - Leveraged industry), listed on NASDAQ.
The ProShares UltraShort Nasdaq Biotechnology fund is engineered to achieve daily returns that are precisely two times the inverse (-2x) of the Nasdaq Biotechnology Index's daily performance. This objective is measured before accounting for any associated fees and operational expenses.
BIS (ProShares - UltraShort Nasdaq Biotechnology) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $2.3M, a beta of -1.18 versus the broader market, a 52-week range of 13.81-35.58, average daily share volume of 9K, a public-listing history dating back to 2010. These structural characteristics shape how BIS etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -1.18 indicates BIS has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. BIS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on BIS?
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 BIS snapshot
As of June 30, 2026, spot at $13.57, ATM IV 55.00%, IV rank 12.05%, expected move 15.77%. The covered call on BIS 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 234-day expiry.
Why this covered call structure on BIS specifically: BIS IV at 55.00% is on the cheap side of its 1-year range, which means a premium-selling BIS covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 15.77% (roughly $2.14 on the underlying). The 234-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated BIS expiries trade a higher absolute premium for lower per-day decay. Position sizing on BIS should anchor to the underlying notional of $13.57 per share and to the trader's directional view on BIS etf.
BIS covered call setup
The BIS 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 BIS near $13.57, the first option leg uses a $14.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BIS chain at a 234-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 BIS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $13.57 | long |
| Sell 1 | Call | $14.00 | $2.93 |
BIS covered call risk and reward
- Net Premium / Debit
- -$1,064.00
- Max Profit (per contract)
- $336.00
- Max Loss (per contract)
- -$1,063.00
- Breakeven(s)
- $10.64
- Risk / Reward Ratio
- 0.316
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.
BIS covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on BIS. 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 | -99.9% | -$1,063.00 |
| $3.01 | -77.8% | -$763.07 |
| $6.01 | -55.7% | -$463.14 |
| $9.01 | -33.6% | -$163.21 |
| $12.01 | -11.5% | +$136.72 |
| $15.01 | +10.6% | +$336.00 |
| $18.01 | +32.7% | +$336.00 |
| $21.01 | +54.8% | +$336.00 |
| $24.00 | +76.9% | +$336.00 |
| $27.00 | +99.0% | +$336.00 |
When traders use covered call on BIS
Covered calls on BIS are an income strategy run on existing BIS etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
BIS thesis for this covered call
The market-implied 1-standard-deviation range for BIS extends from approximately $11.43 on the downside to $15.71 on the upside. A BIS covered call collects premium on an existing long BIS position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether BIS will breach that level within the expiration window. Current BIS IV rank near 12.05% 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 BIS at 55.00%. As a Financial Services name, BIS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BIS-specific events.
BIS 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. BIS positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move BIS alongside the broader basket even when BIS-specific fundamentals are unchanged. Short-premium structures like a covered call on BIS carry tail risk when realized volatility exceeds the implied move; review historical BIS earnings reactions and macro stress periods before sizing. Always rebuild the position from current BIS chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on BIS?
- A covered call on BIS is the covered call strategy applied to BIS (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 BIS etf trading near $13.57, the strikes shown on this page are snapped to the nearest listed BIS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are BIS 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 BIS covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 55.00%), the computed maximum profit is $336.00 per contract and the computed maximum loss is -$1,063.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a BIS covered call?
- The breakeven for the BIS covered call priced on this page is roughly $10.64 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 BIS market-implied 1-standard-deviation expected move is approximately 15.77%; 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 BIS?
- Covered calls on BIS are an income strategy run on existing BIS 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 BIS implied volatility affect this covered call?
- BIS ATM IV is at 55.00% with IV rank near 12.05%, 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.