FICO Covered Call Strategy
FICO (Fair Isaac Corporation), in the Technology sector, (Software - Application industry), listed on NYSE.
Fair Isaac Corporation develops analytic, software, and data management products and services that enable businesses to automate, enhance, and connect decisions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. It operates through two segments, Scores and Software. The Software segment offers pre-configured decision management solution designed for various business problems or processes, such as marketing, account origination, customer management, customer engagement, fraud detection, financial crimes compliance, collection, and marketing, as well as associated professional services. This segment also provides FICO Platform, a modular software offering designed to support advanced analytic and decision use cases, as well as stand-alone analytic and decisioning software that can be configured by customers to address a wide range of business use cases. The Scores segment provides business-to-business scoring solutions and services for consumers that give clients access to analytics to be integrated into their transaction streams and decision-making processes, as well as business-to-consumer scoring solutions comprising myFICO.com subscription offerings. Fair Isaac Corporation markets its products and services primarily through its direct sales organization and indirect channels, as well as online.
FICO (Fair Isaac Corporation) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $24.69B, a trailing P/E of 33.12, a beta of 1.23 versus the broader market, a 52-week range of 870.01-2217.6, average daily share volume of 372K, a public-listing history dating back to 1987, approximately 4K full-time employees. These structural characteristics shape how FICO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.23 places FICO roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a covered call on FICO?
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 FICO snapshot
As of May 15, 2026, spot at $1,098.10, ATM IV 58.00%, IV rank 57.87%, expected move 16.63%. The covered call on FICO 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 FICO specifically: FICO IV at 58.00% is mid-range versus its 1-year history, so the credit collected on a FICO covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 16.63% (roughly $182.59 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 FICO expiries trade a higher absolute premium for lower per-day decay. Position sizing on FICO should anchor to the underlying notional of $1,098.10 per share and to the trader's directional view on FICO stock.
FICO covered call setup
The FICO 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 FICO near $1,098.10, the first option leg uses a $1,150.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FICO 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 FICO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $1,098.10 | long |
| Sell 1 | Call | $1,150.00 | $54.45 |
FICO covered call risk and reward
- Net Premium / Debit
- -$104,365.00
- Max Profit (per contract)
- $10,635.00
- Max Loss (per contract)
- -$104,364.00
- Breakeven(s)
- $1,043.65
- Risk / Reward Ratio
- 0.102
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.
FICO covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on FICO. 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% | -$104,364.00 |
| $242.80 | -77.9% | -$80,084.51 |
| $485.60 | -55.8% | -$55,805.03 |
| $728.39 | -33.7% | -$31,525.54 |
| $971.19 | -11.6% | -$7,246.05 |
| $1,213.98 | +10.6% | +$10,635.00 |
| $1,456.78 | +32.7% | +$10,635.00 |
| $1,699.57 | +54.8% | +$10,635.00 |
| $1,942.37 | +76.9% | +$10,635.00 |
| $2,185.16 | +99.0% | +$10,635.00 |
When traders use covered call on FICO
Covered calls on FICO are an income strategy run on existing FICO stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
FICO thesis for this covered call
The market-implied 1-standard-deviation range for FICO extends from approximately $915.51 on the downside to $1,280.69 on the upside. A FICO covered call collects premium on an existing long FICO position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether FICO will breach that level within the expiration window. Current FICO IV rank near 57.87% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on FICO should anchor more to the directional view and the expected-move geometry. As a Technology name, FICO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FICO-specific events.
FICO 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. FICO positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FICO alongside the broader basket even when FICO-specific fundamentals are unchanged. Short-premium structures like a covered call on FICO carry tail risk when realized volatility exceeds the implied move; review historical FICO earnings reactions and macro stress periods before sizing. Always rebuild the position from current FICO chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on FICO?
- A covered call on FICO is the covered call strategy applied to FICO (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 FICO stock trading near $1,098.10, the strikes shown on this page are snapped to the nearest listed FICO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FICO 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 FICO covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 58.00%), the computed maximum profit is $10,635.00 per contract and the computed maximum loss is -$104,364.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FICO covered call?
- The breakeven for the FICO covered call priced on this page is roughly $1,043.65 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 FICO market-implied 1-standard-deviation expected move is approximately 16.63%; 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 FICO?
- Covered calls on FICO are an income strategy run on existing FICO 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 FICO implied volatility affect this covered call?
- FICO ATM IV is at 58.00% with IV rank near 57.87%, 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.