UMAC Covered Call Strategy
UMAC (Unusual Machines, Inc.), in the Technology sector, (Consumer Electronics industry), listed on AMEX.
Unusual Machines, Inc. engages in the commercial drone industry. The company offers small drones and essential components. It distributes their products through B2B sale, e-commerce site, and retail channel. The company has a strategic collaboration with Lantronix Inc. for the development of autonomous drone components integrating edge AI compute with flight control systems. The company was formerly known as AerocarveUS Corporation and changed its name to Unusual Machines, Inc. in July 2022. Unusual Machines, Inc. was incorporated in 2019 and is headquartered in Orlando, Florida.
UMAC (Unusual Machines, Inc.) trades in the Technology sector, specifically Consumer Electronics, with a market capitalization of approximately $1.29B, a beta of 3.51 versus the broader market, a 52-week range of 7.245-34.36, average daily share volume of 5.3M, a public-listing history dating back to 2024, approximately 141 full-time employees. These structural characteristics shape how UMAC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 3.51 indicates UMAC 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 UMAC?
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.
UMAC snapshot
As of August 14, 2026, spot at $33.56, ATM IV 130.48%, IV rank 54.01%, expected move 37.41%. The covered call on UMAC 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 UMAC specifically: UMAC IV at 130.48% is mid-range versus its 1-year history, so the credit collected on a UMAC covered call sits in line with its long-run distribution, with a market-implied 1-standard-deviation move of approximately 37.41% (roughly $12.55 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 UMAC expiries trade a higher absolute premium for lower per-day decay. Position sizing on UMAC should anchor to the underlying notional of $33.56 per share and to the trader's directional view on UMAC stock.
UMAC covered call setup
The UMAC 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 UMAC at $33.56 on that close, the first option leg uses a $35.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UMAC 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 UMAC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $33.56 | long |
| Sell 1 | Call | $35.00 | $4.05 |
UMAC covered call risk and reward
- Net Premium / Debit
- -$2,951.00
- Max Profit (per contract)
- $549.00
- Max Loss (per contract)
- -$2,950.00
- Breakeven(s)
- $29.51
- Risk / Reward Ratio
- 0.186
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.
UMAC covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on UMAC. 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% | -$2,950.00 |
| $7.43 | -77.9% | -$2,208.08 |
| $14.85 | -55.8% | -$1,466.16 |
| $22.27 | -33.6% | -$724.24 |
| $29.69 | -11.5% | +$17.68 |
| $37.11 | +10.6% | +$549.00 |
| $44.53 | +32.7% | +$549.00 |
| $51.94 | +54.8% | +$549.00 |
| $59.36 | +76.9% | +$549.00 |
| $66.78 | +99.0% | +$549.00 |
When traders use covered call on UMAC
Covered calls on UMAC are an income strategy run on existing UMAC stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
UMAC thesis for this covered call
The market-implied 1-standard-deviation range for UMAC extends from approximately $21.01 on the downside to $46.11 on the upside. A UMAC covered call collects premium on an existing long UMAC position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether UMAC will breach that level within the expiration window. Current UMAC IV rank near 54.01% is mid-range against its 1-year distribution, so the IV signal is neutral; the covered call thesis on UMAC should anchor more to the directional view and the expected-move geometry. As a Technology name, UMAC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UMAC-specific events.
UMAC 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. UMAC positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UMAC alongside the broader basket even when UMAC-specific fundamentals are unchanged. Short-premium structures like a covered call on UMAC carry tail risk when realized volatility exceeds the implied move; review historical UMAC earnings reactions and macro stress periods before sizing. Always rebuild the position from current UMAC chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on UMAC?
- A covered call on UMAC is the covered call strategy applied to UMAC (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 UMAC stock at $33.56 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed UMAC chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are UMAC 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 UMAC covered call priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 130.48%), the computed maximum profit is $549.00 per contract and the computed maximum loss is -$2,950.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UMAC covered call?
- The breakeven for the UMAC covered call priced on this page is roughly $29.51 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 UMAC market-implied 1-standard-deviation expected move in the same options snapshot is approximately 37.41%; 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 UMAC?
- Covered calls on UMAC are an income strategy run on existing UMAC 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 UMAC implied volatility affect this covered call?
- UMAC ATM IV is at 130.48% with IV rank near 54.01%, 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.