How are WTMF 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 WTMF covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 22.10%), the computed maximum profit is $247.00 per contract and the computed maximum loss is -$4,052.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a WTMF covered call?

The breakeven for the WTMF covered call priced on this page is roughly $40.53 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 WTMF market-implied 1-standard-deviation expected move is approximately 6.34%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current WTMF implied volatility affect this covered call?

WTMF ATM IV is at 22.10% with IV rank near 14.17%, 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.

WTMF Covered Call Strategy

WTMF (WisdomTree Managed Futures Strategy Fund), in the Financial Services sector, (Asset Management industry), listed on AMEX.

The fund normally invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in "managed futures". It is an actively managed exchange traded fund ("ETF") that seeks to achieve positive total returns in rising or falling markets that are not directly correlated to broad market equity or fixed income returns. It is non-diversified.

WTMF (WisdomTree Managed Futures Strategy Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $224.0M, a beta of 0.27 versus the broader market, a 52-week range of 34.36-41.43, average daily share volume of 30K, a public-listing history dating back to 2011. These structural characteristics shape how WTMF etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.27 indicates WTMF has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. WTMF pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a covered call on WTMF?

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 WTMF snapshot

As of May 15, 2026, spot at $40.94, ATM IV 22.10%, IV rank 14.17%, expected move 6.34%. The covered call on WTMF 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 34-day expiry.

Why this covered call structure on WTMF specifically: WTMF IV at 22.10% is on the cheap side of its 1-year range, which means a premium-selling WTMF covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 6.34% (roughly $2.59 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated WTMF expiries trade a higher absolute premium for lower per-day decay. Position sizing on WTMF should anchor to the underlying notional of $40.94 per share and to the trader's directional view on WTMF etf.

WTMF covered call setup

The WTMF 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 WTMF near $40.94, the first option leg uses a $43.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed WTMF chain at a 34-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 WTMF shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$40.94	long
Sell 1	Call	$43.00	$0.41

WTMF covered call risk and reward

Net Premium / Debit: -$4,053.00
Max Profit (per contract): $247.00
Max Loss (per contract): -$4,052.00
Breakeven(s): $40.53
Risk / Reward Ratio: 0.061

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.

WTMF covered call payoff curve

Modeled P&L at expiration across a range of underlying prices for the covered call on WTMF. 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%	-$4,052.00
$9.06	-77.9%	-$3,146.90
$18.11	-55.8%	-$2,241.81
$27.16	-33.7%	-$1,336.71
$36.21	-11.5%	-$431.62
$45.26	+10.6%	+$247.00
$54.32	+32.7%	+$247.00
$63.37	+54.8%	+$247.00
$72.42	+76.9%	+$247.00
$81.47	+99.0%	+$247.00

When traders use covered call on WTMF

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

WTMF thesis for this covered call

The market-implied 1-standard-deviation range for WTMF extends from approximately $38.35 on the downside to $43.53 on the upside. A WTMF covered call collects premium on an existing long WTMF position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether WTMF will breach that level within the expiration window. Current WTMF IV rank near 14.17% 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 WTMF at 22.10%. As a Financial Services name, WTMF options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to WTMF-specific events.

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

Frequently asked questions

What is a covered call on WTMF?: A covered call on WTMF is the covered call strategy applied to WTMF (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 WTMF etf trading near $40.94, the strikes shown on this page are snapped to the nearest listed WTMF chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are WTMF 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 WTMF covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 22.10%), the computed maximum profit is $247.00 per contract and the computed maximum loss is -$4,052.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a WTMF covered call?: The breakeven for the WTMF covered call priced on this page is roughly $40.53 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 WTMF market-implied 1-standard-deviation expected move is approximately 6.34%; 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 WTMF?: Covered calls on WTMF are an income strategy run on existing WTMF 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 WTMF implied volatility affect this covered call?: WTMF ATM IV is at 22.10% with IV rank near 14.17%, 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.