AMR Covered Call Strategy
AMR (Alpha Metallurgical Resources, Inc.), in the Energy sector, (Coal industry), listed on NYSE.
Alpha Metallurgical Resources, Inc., a mining company, produces, processes, and sells met and thermal coal in Virginia and West Virginia. As of December 31, 2021, it operated twenty active mines and eight coal preparation and load-out facilities. The company was formerly known as Contura Energy, Inc. and changed its name to Alpha Metallurgical Resources, Inc. in February 2021. Alpha Metallurgical Resources, Inc. was incorporated in 2016 and is headquartered in Bristol, Tennessee.
AMR (Alpha Metallurgical Resources, Inc.) trades in the Energy sector, specifically Coal, with a market capitalization of approximately $2.28B, a beta of 0.62 versus the broader market, a 52-week range of 97.41-253.82, average daily share volume of 282K, a public-listing history dating back to 2021, approximately 4K full-time employees. These structural characteristics shape how AMR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.62 indicates AMR has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a covered call on AMR?
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 AMR snapshot
As of May 15, 2026, spot at $180.73, ATM IV 58.60%, IV rank 34.22%, expected move 16.80%. The covered call on AMR 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 AMR specifically: AMR IV at 58.60% is mid-range versus its 1-year history, so the credit collected on a AMR covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 16.80% (roughly $30.36 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 AMR expiries trade a higher absolute premium for lower per-day decay. Position sizing on AMR should anchor to the underlying notional of $180.73 per share and to the trader's directional view on AMR stock.
AMR covered call setup
The AMR 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 AMR near $180.73, the first option leg uses a $190.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AMR 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 AMR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $180.73 | long |
| Sell 1 | Call | $190.00 | $9.10 |
AMR covered call risk and reward
- Net Premium / Debit
- -$17,163.00
- Max Profit (per contract)
- $1,837.00
- Max Loss (per contract)
- -$17,162.00
- Breakeven(s)
- $171.63
- Risk / Reward Ratio
- 0.107
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.
AMR covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on AMR. 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% | -$17,162.00 |
| $39.97 | -77.9% | -$13,166.07 |
| $79.93 | -55.8% | -$9,170.14 |
| $119.89 | -33.7% | -$5,174.21 |
| $159.85 | -11.6% | -$1,178.28 |
| $199.81 | +10.6% | +$1,837.00 |
| $239.77 | +32.7% | +$1,837.00 |
| $279.73 | +54.8% | +$1,837.00 |
| $319.68 | +76.9% | +$1,837.00 |
| $359.64 | +99.0% | +$1,837.00 |
When traders use covered call on AMR
Covered calls on AMR are an income strategy run on existing AMR stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
AMR thesis for this covered call
The market-implied 1-standard-deviation range for AMR extends from approximately $150.37 on the downside to $211.09 on the upside. A AMR covered call collects premium on an existing long AMR position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether AMR will breach that level within the expiration window. Current AMR IV rank near 34.22% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on AMR should anchor more to the directional view and the expected-move geometry. As a Energy name, AMR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AMR-specific events.
AMR 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. AMR positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AMR alongside the broader basket even when AMR-specific fundamentals are unchanged. Short-premium structures like a covered call on AMR carry tail risk when realized volatility exceeds the implied move; review historical AMR earnings reactions and macro stress periods before sizing. Always rebuild the position from current AMR chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on AMR?
- A covered call on AMR is the covered call strategy applied to AMR (stock). 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 AMR stock trading near $180.73, the strikes shown on this page are snapped to the nearest listed AMR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are AMR 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 AMR covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 58.60%), the computed maximum profit is $1,837.00 per contract and the computed maximum loss is -$17,162.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AMR covered call?
- The breakeven for the AMR covered call priced on this page is roughly $171.63 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 AMR market-implied 1-standard-deviation expected move is approximately 16.80%; 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 AMR?
- Covered calls on AMR are an income strategy run on existing AMR stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
- How does current AMR implied volatility affect this covered call?
- AMR ATM IV is at 58.60% with IV rank near 34.22%, 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.