UYM Covered Call Strategy
UYM (ProShares - Ultra Materials), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.
The ProShares Ultra Materials fund (UYM) endeavors to provide daily returns that are double (2x) the daily performance of the S&P Materials Select SectorSM Index. This objective is pursued before accounting for any associated fees and operating expenses.
UYM (ProShares - Ultra Materials) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $32.6M, a beta of 1.50 versus the broader market, a 52-week range of 21.34-34.54, average daily share volume of 11K, a public-listing history dating back to 2007. These structural characteristics shape how UYM etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.50 indicates UYM has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. UYM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on UYM?
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 UYM snapshot
As of June 30, 2026, spot at $29.72, ATM IV 73.40%, IV rank 45.67%, expected move 21.04%. The covered call on UYM 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 17-day expiry.
Why this covered call structure on UYM specifically: UYM IV at 73.40% is mid-range versus its 1-year history, so the credit collected on a UYM covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 21.04% (roughly $6.25 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated UYM expiries trade a higher absolute premium for lower per-day decay. Position sizing on UYM should anchor to the underlying notional of $29.72 per share and to the trader's directional view on UYM etf.
UYM covered call setup
The UYM 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 UYM near $29.72, the first option leg uses a $31.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UYM chain at a 17-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 UYM shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $29.72 | long |
| Sell 1 | Call | $31.00 | $1.38 |
UYM covered call risk and reward
- Net Premium / Debit
- -$2,834.00
- Max Profit (per contract)
- $266.00
- Max Loss (per contract)
- -$2,833.00
- Breakeven(s)
- $28.34
- Risk / Reward Ratio
- 0.094
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.
UYM covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on UYM. 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% | -$2,833.00 |
| $6.58 | -77.9% | -$2,175.98 |
| $13.15 | -55.8% | -$1,518.97 |
| $19.72 | -33.6% | -$861.95 |
| $26.29 | -11.5% | -$204.94 |
| $32.86 | +10.6% | +$266.00 |
| $39.43 | +32.7% | +$266.00 |
| $46.00 | +54.8% | +$266.00 |
| $52.57 | +76.9% | +$266.00 |
| $59.14 | +99.0% | +$266.00 |
When traders use covered call on UYM
Covered calls on UYM are an income strategy run on existing UYM etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
UYM thesis for this covered call
The market-implied 1-standard-deviation range for UYM extends from approximately $23.47 on the downside to $35.97 on the upside. A UYM covered call collects premium on an existing long UYM position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether UYM will breach that level within the expiration window. Current UYM IV rank near 45.67% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on UYM should anchor more to the directional view and the expected-move geometry. As a Financial Services name, UYM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UYM-specific events.
UYM 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. UYM positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UYM alongside the broader basket even when UYM-specific fundamentals are unchanged. Short-premium structures like a covered call on UYM carry tail risk when realized volatility exceeds the implied move; review historical UYM earnings reactions and macro stress periods before sizing. Always rebuild the position from current UYM chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on UYM?
- A covered call on UYM is the covered call strategy applied to UYM (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 UYM etf trading near $29.72, the strikes shown on this page are snapped to the nearest listed UYM chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UYM 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 UYM covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 73.40%), the computed maximum profit is $266.00 per contract and the computed maximum loss is -$2,833.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UYM covered call?
- The breakeven for the UYM covered call priced on this page is roughly $28.34 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 UYM market-implied 1-standard-deviation expected move is approximately 21.04%; 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 UYM?
- Covered calls on UYM are an income strategy run on existing UYM 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 UYM implied volatility affect this covered call?
- UYM ATM IV is at 73.40% with IV rank near 45.67%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.