WMTI Covered Call Strategy
WMTI (REX WMT Growth & Income ETF), in the Financial Services sector, (Asset Management - Income industry), listed on CBOE.
Under typical market circumstances, this exchange-traded fund (ETF) allocates a minimum of 80% of its total capital (inclusive of borrowed funds) to investments directly in WMT stock, instruments providing exposure to WMT, or securities designed to yield income from WMT-related positions. Its principal strategy for achieving this notional WMT exposure involves utilizing various options contracts on WMT, encompassing both conventional exchange-traded options and customizable Flexible EXchange® (FLEX) Options. Investors should be aware that this fund is classified as non-diversified.
WMTI (REX WMT Growth & Income ETF) trades in the Financial Services sector, specifically Asset Management - Income, with a market capitalization of approximately $10.1M, a beta of 0.28 versus the broader market, a 52-week range of 20.13-30.34, average daily share volume of 35K, a public-listing history dating back to 2025. These structural characteristics shape how WMTI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.28 indicates WMTI has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. WMTI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on WMTI?
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.
WMTI snapshot
As of August 14, 2026, spot at $21.55, ATM IV 10.00%, IV rank 0.41%, expected move 2.87%. The covered call on WMTI 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 126-day expiry.
Why this covered call structure on WMTI specifically: WMTI IV at 10.00% is on the cheap side of its 1-year range, which means a premium-selling WMTI covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 2.87% (roughly $0.62 on the underlying). The 126-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated WMTI expiries trade a higher absolute premium for lower per-day decay. Position sizing on WMTI should anchor to the underlying notional of $21.55 per share and to the trader's directional view on WMTI etf.
WMTI covered call setup
The WMTI 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 WMTI at $21.55 on that close, the first option leg uses a $23.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed WMTI chain at a 126-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 WMTI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $21.55 | long |
| Sell 1 | Call | $23.00 | $0.60 |
WMTI covered call risk and reward
- Net Premium / Debit
- -$2,095.00
- Max Profit (per contract)
- $205.00
- Max Loss (per contract)
- -$2,094.00
- Breakeven(s)
- $20.95
- Risk / Reward Ratio
- 0.098
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.
WMTI covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on WMTI. 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% | -$2,094.00 |
| $4.77 | -77.8% | -$1,617.63 |
| $9.54 | -55.7% | -$1,141.26 |
| $14.30 | -33.6% | -$664.88 |
| $19.06 | -11.5% | -$188.51 |
| $23.83 | +10.6% | +$205.00 |
| $28.59 | +32.7% | +$205.00 |
| $33.36 | +54.8% | +$205.00 |
| $38.12 | +76.9% | +$205.00 |
| $42.88 | +99.0% | +$205.00 |
When traders use covered call on WMTI
Covered calls on WMTI are an income strategy run on existing WMTI etf positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
WMTI thesis for this covered call
The market-implied 1-standard-deviation range for WMTI extends from approximately $20.93 on the downside to $22.17 on the upside. A WMTI covered call collects premium on an existing long WMTI position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether WMTI will breach that level within the expiration window. Current WMTI IV rank near 0.41% 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 WMTI at 10.00%. As a Financial Services name, WMTI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to WMTI-specific events.
WMTI 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. WMTI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move WMTI alongside the broader basket even when WMTI-specific fundamentals are unchanged. Short-premium structures like a covered call on WMTI carry tail risk when realized volatility exceeds the implied move; review historical WMTI earnings reactions and macro stress periods before sizing. Always rebuild the position from current WMTI chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on WMTI?
- A covered call on WMTI is the covered call strategy applied to WMTI (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 WMTI etf at $21.55 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed WMTI chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are WMTI 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 WMTI covered call priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 10.00%), the computed maximum profit is $205.00 per contract and the computed maximum loss is -$2,094.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a WMTI covered call?
- The breakeven for the WMTI covered call priced on this page is roughly $20.95 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 WMTI market-implied 1-standard-deviation expected move in the same options snapshot is approximately 2.87%; 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 WMTI?
- Covered calls on WMTI are an income strategy run on existing WMTI 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 WMTI implied volatility affect this covered call?
- WMTI ATM IV is at 10.00% with IV rank near 0.41%, 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.