LUNR Covered Call Strategy
LUNR (Intuitive Machines, Inc.), in the Industrials sector, (Aerospace & Defense industry), listed on NASDAQ.
Intuitive Machines, Inc. specializes in the development and provision of aerospace products and services. The company's core mission is to facilitate ongoing robotic and human missions aimed at exploring the Moon, Mars, and other distant celestial bodies. Its comprehensive offerings are delivered through several distinct divisions: Lunar Access Services, Orbital Services, Lunar Data Services, and Space Products and Infrastructure. Headquartered in Houston, Texas, this firm was established in 2013.
LUNR (Intuitive Machines, Inc.) trades in the Industrials sector, specifically Aerospace & Defense, with a market capitalization of approximately $2.70B, a beta of 1.83 versus the broader market, a 52-week range of 7.78-46.75, average daily share volume of 13.8M, a public-listing history dating back to 2021, approximately 525 full-time employees. These structural characteristics shape how LUNR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.83 indicates LUNR has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a covered call on LUNR?
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.
LUNR snapshot
As of August 14, 2026, spot at $18.97, ATM IV 96.37%, IV rank 38.45%, expected move 27.63%. The covered call on LUNR below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 28-day expiry.
Why this covered call structure on LUNR specifically: LUNR IV at 96.37% is mid-range versus its 1-year history, so the credit collected on a LUNR covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 27.63% (roughly $5.24 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LUNR expiries trade a higher absolute premium for lower per-day decay. Position sizing on LUNR should anchor to the underlying notional of $18.97 per share and to the trader's directional view on LUNR stock.
LUNR covered call setup
The LUNR covered call below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With LUNR at $18.97 on that close, the first option leg uses a $20.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LUNR chain at a 28-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 LUNR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $18.97 | long |
| Sell 1 | Call | $20.00 | $1.58 |
LUNR covered call risk and reward
- Net Premium / Debit
- -$1,739.00
- Max Profit (per contract)
- $261.00
- Max Loss (per contract)
- -$1,738.00
- Breakeven(s)
- $17.39
- Risk / Reward Ratio
- 0.150
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.
LUNR covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on LUNR. 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 | -99.9% | -$1,738.00 |
| $4.20 | -77.8% | -$1,318.67 |
| $8.40 | -55.7% | -$899.35 |
| $12.59 | -33.6% | -$480.02 |
| $16.78 | -11.5% | -$60.69 |
| $20.98 | +10.6% | +$261.00 |
| $25.17 | +32.7% | +$261.00 |
| $29.36 | +54.8% | +$261.00 |
| $33.56 | +76.9% | +$261.00 |
| $37.75 | +99.0% | +$261.00 |
When traders use covered call on LUNR
Covered calls on LUNR are an income strategy run on existing LUNR stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
LUNR thesis for this covered call
The market-implied 1-standard-deviation range for LUNR extends from approximately $13.73 on the downside to $24.21 on the upside. A LUNR covered call collects premium on an existing long LUNR position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether LUNR will breach that level within the expiration window. Current LUNR IV rank near 38.45% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on LUNR should anchor more to the directional view and the expected-move geometry. As a Industrials name, LUNR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LUNR-specific events.
LUNR 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. LUNR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LUNR alongside the broader basket even when LUNR-specific fundamentals are unchanged. Short-premium structures like a covered call on LUNR carry tail risk when realized volatility exceeds the implied move; review historical LUNR earnings reactions and macro stress periods before sizing. Always rebuild the position from current LUNR chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on LUNR?
- A covered call on LUNR is the covered call strategy applied to LUNR (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 LUNR stock at $18.97 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed LUNR chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are LUNR 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 LUNR covered call priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 96.37%), the computed maximum profit is $261.00 per contract and the computed maximum loss is -$1,738.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LUNR covered call?
- The breakeven for the LUNR covered call priced on this page is roughly $17.39 at expiration, derived from the August 14, 2026 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 LUNR market-implied 1-standard-deviation expected move in the same options snapshot is approximately 27.63%; 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 LUNR?
- Covered calls on LUNR are an income strategy run on existing LUNR 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 LUNR implied volatility affect this covered call?
- LUNR ATM IV is at 96.37% with IV rank near 38.45%, 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.