RDCM Covered Call Strategy

RDCM (RADCOM Ltd.), in the Communication Services sector, (Telecommunications Services industry), listed on NASDAQ.

RADCOM Ltd. provides sophisticated, cloud-native solutions for network intelligence and service assurance, primarily designed for telecommunications companies and communication service providers (CSPs). These offerings are fully prepared for 5G environments. The company's flagship product, RADCOM ACE, is an integrated suite comprising several core components: RADCOM Service Assurance: A virtualized, cloud-native, and 5G-compatible tool that grants operators comprehensive oversight of their entire network and deep understanding of customer experience. RADCOM Network Visibility: This cloud-native network packet broker and filtering system enables CSPs to efficiently manage substantial volumes of network traffic across diverse cloud environments, offering precise control over data visibility for targeted analysis. RADCOM Network Insights: A business intelligence platform that generates actionable insights for various operational scenarios by leveraging data collected and harmonized through both Service Assurance and Network Visibility. RADCOM's technology is compatible with a wide array of mobile and fixed network standards, including 5G, Long Term Evolution (LTE), Voice over LTE (VoLTE), Voice over Wi-Fi (VoWiFi), IP Multimedia Subsystem (IMS), Voice over IP (VoIP), and Universal Mobile Telecommunication Service (UMTS).

RDCM (RADCOM Ltd.) trades in the Communication Services sector, specifically Telecommunications Services, with a market capitalization of approximately $172.7M, a trailing P/E of 13.63, a beta of 0.74 versus the broader market, a 52-week range of 9.4-16.74, average daily share volume of 203K, a public-listing history dating back to 1997, approximately 325 full-time employees. These structural characteristics shape how RDCM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.74 places RDCM 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 RDCM?

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.

RDCM snapshot

As of August 14, 2026, spot at $10.54, ATM IV 293.00%, expected move 84.00%. The covered call on RDCM 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 RDCM specifically: IV rank is unavailable in the current snapshot, so regime-based timing for RDCM is inferred from ATM IV at 293.00% alone, with a market-implied 1-standard-deviation move of approximately 84.00% (roughly $8.85 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 RDCM expiries trade a higher absolute premium for lower per-day decay. Position sizing on RDCM should anchor to the underlying notional of $10.54 per share and to the trader's directional view on RDCM stock.

RDCM covered call setup

The RDCM 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 RDCM at $10.54 on that close, the first option leg uses a $11.07 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RDCM 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 RDCM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$10.54	long
Sell 1	Call	$11.07	N/A

RDCM 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.

RDCM covered call payoff curve

Modeled P&L at expiration across a range of underlying prices for the covered call on RDCM. 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 RDCM

Covered calls on RDCM are an income strategy run on existing RDCM stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.

RDCM thesis for this covered call

The market-implied 1-standard-deviation range for RDCM extends from approximately $1.69 on the downside to $19.39 on the upside. A RDCM covered call collects premium on an existing long RDCM position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether RDCM will breach that level within the expiration window. As a Communication Services name, RDCM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RDCM-specific events.

RDCM 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. RDCM positions also carry Communication Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RDCM alongside the broader basket even when RDCM-specific fundamentals are unchanged. Short-premium structures like a covered call on RDCM carry tail risk when realized volatility exceeds the implied move; review historical RDCM earnings reactions and macro stress periods before sizing. Always rebuild the position from current RDCM chain quotes before placing a trade.

Frequently asked questions

What is a covered call on RDCM?: A covered call on RDCM is the covered call strategy applied to RDCM (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 RDCM stock at $10.54 on the most recent close, the strikes shown on this page are snapped to the nearest listed RDCM chain strike and the premiums come straight from that session's bid/ask midpoint.
How are RDCM 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 RDCM covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 293.00%), 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 RDCM covered call?: The breakeven for the RDCM 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 RDCM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 84.00%; 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 RDCM?: Covered calls on RDCM are an income strategy run on existing RDCM 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 RDCM implied volatility affect this covered call?: Current RDCM ATM IV is 293.00%; IV rank context is unavailable in the current snapshot.