STRZ Covered Call Strategy
STRZ (Starz Entertainment Corp.), in the Communication Services sector, (Entertainment industry), listed on NASDAQ.
Starz Entertainment Corp. provides subscription video programming to consumers in the United States and Canada. Its business consists of the distribution of STARZ-branded premium subscription video services through over-the-top platforms and distributors on a direct to-consumer basis through the STARZ-branded app and through multichannel video programming distributors. The company is based in Vancouver, Canada.
STRZ (Starz Entertainment Corp.) trades in the Communication Services sector, specifically Entertainment, with a market capitalization of approximately $329.7M, a beta of 2.52 versus the broader market, a 52-week range of 8.4-22.98, average daily share volume of 175K, a public-listing history dating back to 2025, approximately 2K full-time employees. These structural characteristics shape how STRZ stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 2.52 indicates STRZ 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 STRZ?
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 STRZ snapshot
As of May 15, 2026, spot at $23.16, ATM IV 92.80%, IV rank 14.44%, expected move 26.60%. The covered call on STRZ 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 STRZ specifically: STRZ IV at 92.80% is on the cheap side of its 1-year range, which means a premium-selling STRZ covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 26.60% (roughly $6.16 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 STRZ expiries trade a higher absolute premium for lower per-day decay. Position sizing on STRZ should anchor to the underlying notional of $23.16 per share and to the trader's directional view on STRZ stock.
STRZ covered call setup
The STRZ 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 STRZ near $23.16, the first option leg uses a $24.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed STRZ 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 STRZ shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $23.16 | long |
| Sell 1 | Call | $24.00 | $1.90 |
STRZ covered call risk and reward
- Net Premium / Debit
- -$2,126.00
- Max Profit (per contract)
- $274.00
- Max Loss (per contract)
- -$2,125.00
- Breakeven(s)
- $21.26
- Risk / Reward Ratio
- 0.129
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.
STRZ covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on STRZ. 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% | -$2,125.00 |
| $5.13 | -77.9% | -$1,613.03 |
| $10.25 | -55.7% | -$1,101.06 |
| $15.37 | -33.6% | -$589.09 |
| $20.49 | -11.5% | -$77.12 |
| $25.61 | +10.6% | +$274.00 |
| $30.73 | +32.7% | +$274.00 |
| $35.85 | +54.8% | +$274.00 |
| $40.97 | +76.9% | +$274.00 |
| $46.09 | +99.0% | +$274.00 |
When traders use covered call on STRZ
Covered calls on STRZ are an income strategy run on existing STRZ stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
STRZ thesis for this covered call
The market-implied 1-standard-deviation range for STRZ extends from approximately $17.00 on the downside to $29.32 on the upside. A STRZ covered call collects premium on an existing long STRZ position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether STRZ will breach that level within the expiration window. Current STRZ IV rank near 14.44% 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 STRZ at 92.80%. As a Communication Services name, STRZ options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to STRZ-specific events.
STRZ 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. STRZ positions also carry Communication Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move STRZ alongside the broader basket even when STRZ-specific fundamentals are unchanged. Short-premium structures like a covered call on STRZ carry tail risk when realized volatility exceeds the implied move; review historical STRZ earnings reactions and macro stress periods before sizing. Always rebuild the position from current STRZ chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on STRZ?
- A covered call on STRZ is the covered call strategy applied to STRZ (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 STRZ stock trading near $23.16, the strikes shown on this page are snapped to the nearest listed STRZ chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are STRZ 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 STRZ covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 92.80%), the computed maximum profit is $274.00 per contract and the computed maximum loss is -$2,125.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a STRZ covered call?
- The breakeven for the STRZ covered call priced on this page is roughly $21.26 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 STRZ market-implied 1-standard-deviation expected move is approximately 26.60%; 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 STRZ?
- Covered calls on STRZ are an income strategy run on existing STRZ 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 STRZ implied volatility affect this covered call?
- STRZ ATM IV is at 92.80% with IV rank near 14.44%, 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.