How are CARZ 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 CARZ covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 26.20%), the computed maximum profit is $639.00 per contract and the computed maximum loss is -$11,160.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a CARZ covered call?

The breakeven for the CARZ covered call priced on this page is roughly $111.61 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 CARZ market-implied 1-standard-deviation expected move is approximately 7.51%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current CARZ implied volatility affect this covered call?

CARZ ATM IV is at 26.20% with IV rank near 1.22%, 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.

CARZ Covered Call Strategy

CARZ (First Trust S-Network Future Vehicles & Technology ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.

The First Trust S-Network Future Vehicles & Technology ETF (CARZ), previously known as the First Trust NASDAQ Global Auto Index Fund, endeavors to generally mirror the price and income performance of the S-Network Electric & Future Vehicle Ecosystem Index, prior to accounting for its own operational costs. The fund typically allocates at least 90% of its total assets, which may include borrowed capital used for investment, to the common stocks and depository receipts that comprise this benchmark index.

CARZ (First Trust S-Network Future Vehicles & Technology ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $53.8M, a beta of 1.77 versus the broader market, a 52-week range of 61.21-123.17, average daily share volume of 4K, a public-listing history dating back to 2011. These structural characteristics shape how CARZ etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.77 indicates CARZ has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. CARZ pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a covered call on CARZ?

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 CARZ snapshot

As of June 26, 2026, spot at $112.45, ATM IV 26.20%, IV rank 1.22%, expected move 7.51%. The covered call on CARZ 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 18-day expiry.

Why this covered call structure on CARZ specifically: CARZ IV at 26.20% is on the cheap side of its 1-year range, which means a premium-selling CARZ covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 7.51% (roughly $8.45 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CARZ expiries trade a higher absolute premium for lower per-day decay. Position sizing on CARZ should anchor to the underlying notional of $112.45 per share and to the trader's directional view on CARZ etf.

CARZ covered call setup

The CARZ 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 CARZ near $112.45, the first option leg uses a $118.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CARZ chain at a 18-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 CARZ shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$112.45	long
Sell 1	Call	$118.00	$0.84

CARZ covered call risk and reward

Net Premium / Debit: -$11,161.00
Max Profit (per contract): $639.00
Max Loss (per contract): -$11,160.00
Breakeven(s): $111.61
Risk / Reward Ratio: 0.057

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.

CARZ covered call payoff curve

Modeled P&L at expiration across a range of underlying prices for the covered call on CARZ. 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%	-$11,160.00
$24.87	-77.9%	-$8,673.78
$49.73	-55.8%	-$6,187.56
$74.60	-33.7%	-$3,701.34
$99.46	-11.6%	-$1,215.12
$124.32	+10.6%	+$639.00
$149.18	+32.7%	+$639.00
$174.05	+54.8%	+$639.00
$198.91	+76.9%	+$639.00
$223.77	+99.0%	+$639.00

When traders use covered call on CARZ

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

CARZ thesis for this covered call

The market-implied 1-standard-deviation range for CARZ extends from approximately $104.00 on the downside to $120.90 on the upside. A CARZ covered call collects premium on an existing long CARZ position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether CARZ will breach that level within the expiration window. Current CARZ IV rank near 1.22% 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 CARZ at 26.20%. As a Financial Services name, CARZ options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CARZ-specific events.

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

Frequently asked questions

What is a covered call on CARZ?: A covered call on CARZ is the covered call strategy applied to CARZ (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 CARZ etf trading near $112.45, the strikes shown on this page are snapped to the nearest listed CARZ chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are CARZ 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 CARZ covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 26.20%), the computed maximum profit is $639.00 per contract and the computed maximum loss is -$11,160.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CARZ covered call?: The breakeven for the CARZ covered call priced on this page is roughly $111.61 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 CARZ market-implied 1-standard-deviation expected move is approximately 7.51%; 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 CARZ?: Covered calls on CARZ are an income strategy run on existing CARZ 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 CARZ implied volatility affect this covered call?: CARZ ATM IV is at 26.20% with IV rank near 1.22%, 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.