BSRR Covered Call Strategy
BSRR (Sierra Bancorp), in the Financial Services sector, (Banks - Regional industry), listed on NASDAQ.
Sierra Bancorp serves as the holding company for Bank of the Sierra, providing a full suite of retail and commercial banking services to individuals and businesses across California. The institution offers diverse deposit solutions, including checking, savings, money market, time deposits, retirement, and sweep accounts. Its lending portfolio encompasses agricultural, commercial, consumer, real estate, construction, and mortgage loans. Additionally, the company facilitates access to automated teller machines (ATMs), electronic point-of-sale payment options, online and automated telephone banking, and business-focused services such as remote deposit capture and automated payroll. As of December 31, 2021, Sierra Bancorp operated 35 full-service branches, an online branch, a loan production office, an agricultural credit center, and an SBA center. Founded in 1977, its corporate headquarters are located in Porterville, California.
BSRR (Sierra Bancorp) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $532.8M, a trailing P/E of 11.69, a beta of 0.76 versus the broader market, a 52-week range of 26.49-43.13, average daily share volume of 61K, a public-listing history dating back to 1994, approximately 452 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 11.69 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.
BSRR snapshot
As of August 14, 2026, spot at $40.80, ATM IV 53.50%, IV rank 18.33%, expected move 15.34%. The covered call on BSRR below is built from the end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this covered call structure on BSRR specifically: BSRR IV at 53.50% is on the cheap side of its 1-year range, which means a premium-selling BSRR covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 15.34% (roughly $6.26 on the underlying). The 35-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 $40.80 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 at $40.80 on that close, the first option leg uses a $42.84 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 35-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 | $40.80 | long |
| Sell 1 | Call | $42.84 | 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 $34.54 on the downside to $47.06 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 18.33% 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 BSRR at 53.50%. 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 at $40.80 on the most recent close, the strikes shown on this page are snapped to the nearest listed BSRR chain strike and the premiums come straight from that session's 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 53.50%), 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 the 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 BSRR market-implied 1-standard-deviation expected move in the same options snapshot is approximately 15.34%; 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 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 53.50% with IV rank near 18.33%, 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.