BSRR Covered Call Strategy
BSRR (Sierra Bancorp), in the Financial Services sector, (Banks - Regional industry), listed on NASDAQ.
Sierra Bancorp operates as the bank holding company for Bank of the Sierra that provides retail and commercial banking services to individuals and businesses in California. The company accepts various deposit products, such as checking accounts, savings accounts, money market demand accounts, time deposits, retirement accounts, and sweep accounts. Its loan products include agricultural, commercial, consumer, real estate, construction, and mortgage loans. The company also offers automated teller machines; electronic point-of-sale payment alternatives; online and automated telephone banking services; and remote deposit capture and automated payroll services for business customers. As of December 31, 2021, it operated 35 full-service branches, an online branch, a loan production office, an agricultural credit center, and an SBA center. Sierra Bancorp was founded in 1977 and is headquartered in Porterville, California.
BSRR (Sierra Bancorp) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $483.1M, a trailing P/E of 10.49, a beta of 0.76 versus the broader market, a 52-week range of 26.49-38.6, average daily share volume of 52K, a public-listing history dating back to 1994, approximately 489 full-time employees. These structural characteristics shape how BSRR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.76 places BSRR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 10.49 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. BSRR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on BSRR?
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 BSRR snapshot
As of May 15, 2026, spot at $37.33, ATM IV 75.50%, IV rank 33.87%, expected move 21.65%. The covered call on BSRR 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 BSRR specifically: BSRR IV at 75.50% is mid-range versus its 1-year history, so the credit collected on a BSRR covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 21.65% (roughly $8.08 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 BSRR expiries trade a higher absolute premium for lower per-day decay. Position sizing on BSRR should anchor to the underlying notional of $37.33 per share and to the trader's directional view on BSRR stock.
BSRR covered call setup
The BSRR 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 BSRR near $37.33, the first option leg uses a $39.20 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BSRR 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 BSRR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $37.33 | long |
| Sell 1 | Call | $39.20 | N/A |
BSRR covered call risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
BSRR covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on BSRR. 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.
When traders use covered call on BSRR
Covered calls on BSRR are an income strategy run on existing BSRR stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
BSRR thesis for this covered call
The market-implied 1-standard-deviation range for BSRR extends from approximately $29.25 on the downside to $45.41 on the upside. A BSRR covered call collects premium on an existing long BSRR position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether BSRR will breach that level within the expiration window. Current BSRR IV rank near 33.87% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on BSRR should anchor more to the directional view and the expected-move geometry. As a Financial Services name, BSRR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BSRR-specific events.
BSRR 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. BSRR positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move BSRR alongside the broader basket even when BSRR-specific fundamentals are unchanged. Short-premium structures like a covered call on BSRR carry tail risk when realized volatility exceeds the implied move; review historical BSRR earnings reactions and macro stress periods before sizing. Always rebuild the position from current BSRR chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on BSRR?
- A covered call on BSRR is the covered call strategy applied to BSRR (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 BSRR stock trading near $37.33, the strikes shown on this page are snapped to the nearest listed BSRR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are BSRR 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 BSRR covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 75.50%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a BSRR covered call?
- The breakeven for the BSRR covered call priced on this page is no defined breakeven on the modeled curve 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 BSRR market-implied 1-standard-deviation expected move is approximately 21.65%; 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 BSRR?
- Covered calls on BSRR are an income strategy run on existing BSRR 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 BSRR implied volatility affect this covered call?
- BSRR ATM IV is at 75.50% with IV rank near 33.87%, 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.