SDGR Covered Call Strategy
SDGR (Schrödinger, Inc.), in the Healthcare sector, (Medical - Healthcare Information Services industry), listed on NASDAQ.
Schrödinger, Inc., together with its subsidiaries, provides physics-based software platform that enables discovery of novel molecules for drug development and materials applications. The company operates in two segments, Software and Drug Discovery. The Software segment is focused on selling its software for drug discovery in the life sciences industry, as well as to customers in materials science industries. The Drug Discovery segment focuses on building a portfolio of preclinical and clinical programs, internally and through collaborations. The company serves biopharmaceutical and industrial companies, academic institutions, and government laboratories worldwide. Schrödinger, Inc. was incorporated in 1990 and is based in New York, New York.
SDGR (Schrödinger, Inc.) trades in the Healthcare sector, specifically Medical - Healthcare Information Services, with a market capitalization of approximately $952.7M, a beta of 1.58 versus the broader market, a 52-week range of 10.945-27.63, average daily share volume of 1.4M, a public-listing history dating back to 2020, approximately 891 full-time employees. These structural characteristics shape how SDGR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.58 indicates SDGR 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 SDGR?
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 SDGR snapshot
As of May 15, 2026, spot at $11.95, ATM IV 77.20%, IV rank 57.13%, expected move 22.13%. The covered call on SDGR 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 SDGR specifically: SDGR IV at 77.20% is mid-range versus its 1-year history, so the credit collected on a SDGR covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 22.13% (roughly $2.64 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 SDGR expiries trade a higher absolute premium for lower per-day decay. Position sizing on SDGR should anchor to the underlying notional of $11.95 per share and to the trader's directional view on SDGR stock.
SDGR covered call setup
The SDGR 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 SDGR near $11.95, the first option leg uses a $12.55 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed SDGR 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 SDGR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $11.95 | long |
| Sell 1 | Call | $12.55 | N/A |
SDGR 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.
SDGR covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on SDGR. 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 SDGR
Covered calls on SDGR are an income strategy run on existing SDGR stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
SDGR thesis for this covered call
The market-implied 1-standard-deviation range for SDGR extends from approximately $9.31 on the downside to $14.59 on the upside. A SDGR covered call collects premium on an existing long SDGR position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether SDGR will breach that level within the expiration window. Current SDGR IV rank near 57.13% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on SDGR should anchor more to the directional view and the expected-move geometry. As a Healthcare name, SDGR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to SDGR-specific events.
SDGR 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. SDGR positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move SDGR alongside the broader basket even when SDGR-specific fundamentals are unchanged. Short-premium structures like a covered call on SDGR carry tail risk when realized volatility exceeds the implied move; review historical SDGR earnings reactions and macro stress periods before sizing. Always rebuild the position from current SDGR chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on SDGR?
- A covered call on SDGR is the covered call strategy applied to SDGR (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 SDGR stock trading near $11.95, the strikes shown on this page are snapped to the nearest listed SDGR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are SDGR 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 SDGR covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 77.20%), 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 SDGR covered call?
- The breakeven for the SDGR 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 SDGR market-implied 1-standard-deviation expected move is approximately 22.13%; 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 SDGR?
- Covered calls on SDGR are an income strategy run on existing SDGR 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 SDGR implied volatility affect this covered call?
- SDGR ATM IV is at 77.20% with IV rank near 57.13%, 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.