HY Covered Call Strategy
HY (Hyster-Yale Materials Handling, Inc.), in the Industrials sector, (Agricultural - Machinery industry), listed on NYSE.
Hyster-Yale Materials Handling, Inc., through its subsidiaries, designs, engineers, manufactures, sells, and services a line of lift trucks, attachments, and aftermarket parts worldwide. It manufactures components, such as frames, masts, and transmissions; and assembles lift trucks. The company markets its products primarily under the Hyster and Yale brand names to independent Hyster and Yale retail dealerships. It also sells aftermarket parts under the Hyster and Yale, as well as UNISOURCE and PREMIER brands to Hyster and Yale dealers for the service of competitor lift trucks. In addition, the company produces and distributes attachments, forks, and lift tables under the Bolzoni, Auramo, and Meyer brand names; and designs and produces products in the port equipment and rough terrain forklift markets. Further, it designs, manufactures, and sells hydrogen fuel-cell stacks and engines.
HY (Hyster-Yale Materials Handling, Inc.) trades in the Industrials sector, specifically Agricultural - Machinery, with a market capitalization of approximately $644.0M, a beta of 1.66 versus the broader market, a 52-week range of 26.41-44.55, average daily share volume of 92K, a public-listing history dating back to 2012, approximately 9K full-time employees. These structural characteristics shape how HY stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.66 indicates HY has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. HY pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a covered call on HY?
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 HY snapshot
As of May 15, 2026, spot at $35.75, ATM IV 36.90%, IV rank 7.48%, expected move 10.58%. The covered call on HY 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 HY specifically: HY IV at 36.90% is on the cheap side of its 1-year range, which means a premium-selling HY covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 10.58% (roughly $3.78 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 HY expiries trade a higher absolute premium for lower per-day decay. Position sizing on HY should anchor to the underlying notional of $35.75 per share and to the trader's directional view on HY stock.
HY covered call setup
The HY 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 HY near $35.75, the first option leg uses a $37.54 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HY 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 HY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $35.75 | long |
| Sell 1 | Call | $37.54 | N/A |
HY 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.
HY covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on HY. 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 HY
Covered calls on HY are an income strategy run on existing HY stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
HY thesis for this covered call
The market-implied 1-standard-deviation range for HY extends from approximately $31.97 on the downside to $39.53 on the upside. A HY covered call collects premium on an existing long HY position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether HY will breach that level within the expiration window. Current HY IV rank near 7.48% 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 HY at 36.90%. As a Industrials name, HY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HY-specific events.
HY 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. HY positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move HY alongside the broader basket even when HY-specific fundamentals are unchanged. Short-premium structures like a covered call on HY carry tail risk when realized volatility exceeds the implied move; review historical HY earnings reactions and macro stress periods before sizing. Always rebuild the position from current HY chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on HY?
- A covered call on HY is the covered call strategy applied to HY (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 HY stock trading near $35.75, the strikes shown on this page are snapped to the nearest listed HY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are HY 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 HY covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 36.90%), 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 HY covered call?
- The breakeven for the HY 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 HY market-implied 1-standard-deviation expected move is approximately 10.58%; 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 HY?
- Covered calls on HY are an income strategy run on existing HY 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 HY implied volatility affect this covered call?
- HY ATM IV is at 36.90% with IV rank near 7.48%, 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.