How are REW 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 REW covered call priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 31.10%), the computed maximum profit is $127.00 per contract and the computed maximum loss is -$1,072.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a REW covered call?

The breakeven for the REW covered call priced on this page is roughly $10.73 at expiration, derived from the August 14, 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 REW market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.92%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current REW implied volatility affect this covered call?

REW ATM IV is at 31.10% with IV rank near 2.09%, 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.

REW Covered Call Strategy

REW (ProShares - UltraShort Technology), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.

This ProShares UltraShort Technology fund endeavors to achieve daily investment outcomes that inversely track, at a two-to-one (2x) ratio, the day-to-day fluctuations of the S&P Technology Select Sector Index. This objective is stated before accounting for any associated fees and operating expenses.

REW (ProShares - UltraShort Technology) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $3.7M, a beta of -2.62 versus the broader market, a 52-week range of 11.03-29, average daily share volume of 32K, a public-listing history dating back to 2007. These structural characteristics shape how REW etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of -2.62 indicates REW has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. REW pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a covered call on REW?

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.

REW snapshot

As of August 14, 2026, spot at $11.13, ATM IV 31.10%, IV rank 2.09%, expected move 8.92%. The covered call on REW below is built from the August 14, 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 REW specifically: REW IV at 31.10% is on the cheap side of its 1-year range, which means a premium-selling REW covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 8.92% (roughly $0.99 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 REW expiries trade a higher absolute premium for lower per-day decay. Position sizing on REW should anchor to the underlying notional of $11.13 per share and to the trader's directional view on REW etf.

REW covered call setup

The REW covered call below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With REW at $11.13 on that close, the first option leg uses a $12.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed REW 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 REW shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$11.13	long
Sell 1	Call	$12.00	$0.40

REW covered call risk and reward

Net Premium / Debit: -$1,073.00
Max Profit (per contract): $127.00
Max Loss (per contract): -$1,072.00
Breakeven(s): $10.73
Risk / Reward Ratio: 0.118

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.

REW covered call payoff curve

Modeled P&L at expiration across a range of underlying prices for the covered call on REW. 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	-99.9%	-$1,072.00
$2.47	-77.8%	-$826.02
$4.93	-55.7%	-$580.04
$7.39	-33.6%	-$334.06
$9.85	-11.5%	-$88.08
$12.31	+10.6%	+$127.00
$14.77	+32.7%	+$127.00
$17.23	+54.8%	+$127.00
$19.69	+76.9%	+$127.00
$22.15	+99.0%	+$127.00

When traders use covered call on REW

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

REW thesis for this covered call

The market-implied 1-standard-deviation range for REW extends from approximately $10.14 on the downside to $12.12 on the upside. A REW covered call collects premium on an existing long REW position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether REW will breach that level within the expiration window. Current REW IV rank near 2.09% 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 REW at 31.10%. As a Financial Services name, REW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to REW-specific events.

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

Frequently asked questions

What is a covered call on REW?: A covered call on REW is the covered call strategy applied to REW (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 REW etf at $11.13 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed REW chain strike and the premiums come straight from that session's bid/ask midpoint.
How are REW 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 REW covered call priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 31.10%), the computed maximum profit is $127.00 per contract and the computed maximum loss is -$1,072.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a REW covered call?: The breakeven for the REW covered call priced on this page is roughly $10.73 at expiration, derived from the August 14, 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 REW market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.92%; 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 REW?: Covered calls on REW are an income strategy run on existing REW 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 REW implied volatility affect this covered call?: REW ATM IV is at 31.10% with IV rank near 2.09%, 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.