ZVRA Covered Call Strategy
ZVRA (Zevra Therapeutics, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Zevra Therapeutics, Inc., a rare disease company melding science, discovers and develops various proprietary prodrugs to treat serious medical conditions in the United States. The company utilizes its Ligand Activated Therapy technology to generate improved prodrug versions of FDA-approved drugs, as well as to generate prodrug versions of existing compounds that may have applications for new disease indications. Its prodrug product candidate pipeline is focused on the high need areas of attention deficit hyperactivity disorder, stimulant use disorder, and CNS rare diseases, including idiopathic hypersomnia (IH). The company's lead product candidate KP1077, which is under Phase II clinical trial for the treatment of IH and narcolepsy, is based on its prodrug of d-methylphenidate, known as serdexmethylphenidate. It is also developing KP879, a prodrug product candidate for the treatment of stimulant use disorder and is under Phase II clinical trial. In addition, the company has received FDA approval for AZSTARYS, a once-daily treatment for attention deficit hyperactivity disorder in patents age six years and older, and for APADAZ, an immediate-release combination product containing benzhydrocodone, a prodrug of hydrocodone, and acetaminophen.
ZVRA (Zevra Therapeutics, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $657.4M, a trailing P/E of 5.23, a beta of 0.88 versus the broader market, a 52-week range of 7.16-13.16, average daily share volume of 1.1M, a public-listing history dating back to 2015, approximately 59 full-time employees. These structural characteristics shape how ZVRA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.88 places ZVRA roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 5.23 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price.
What is a covered call on ZVRA?
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 ZVRA snapshot
As of May 15, 2026, spot at $11.07, ATM IV 61.10%, IV rank 14.91%, expected move 17.52%. The covered call on ZVRA 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 98-day expiry.
Why this covered call structure on ZVRA specifically: ZVRA IV at 61.10% is on the cheap side of its 1-year range, which means a premium-selling ZVRA covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 17.52% (roughly $1.94 on the underlying). The 98-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ZVRA expiries trade a higher absolute premium for lower per-day decay. Position sizing on ZVRA should anchor to the underlying notional of $11.07 per share and to the trader's directional view on ZVRA stock.
ZVRA covered call setup
The ZVRA 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 ZVRA near $11.07, the first option leg uses a $12.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ZVRA chain at a 98-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 ZVRA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $11.07 | long |
| Sell 1 | Call | $12.00 | $1.92 |
ZVRA covered call risk and reward
- Net Premium / Debit
- -$915.00
- Max Profit (per contract)
- $285.00
- Max Loss (per contract)
- -$914.00
- Breakeven(s)
- $9.15
- Risk / Reward Ratio
- 0.312
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.
ZVRA covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on ZVRA. 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% | -$914.00 |
| $2.46 | -77.8% | -$669.35 |
| $4.90 | -55.7% | -$424.69 |
| $7.35 | -33.6% | -$180.04 |
| $9.80 | -11.5% | +$64.61 |
| $12.24 | +10.6% | +$285.00 |
| $14.69 | +32.7% | +$285.00 |
| $17.14 | +54.8% | +$285.00 |
| $19.58 | +76.9% | +$285.00 |
| $22.03 | +99.0% | +$285.00 |
When traders use covered call on ZVRA
Covered calls on ZVRA are an income strategy run on existing ZVRA stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
ZVRA thesis for this covered call
The market-implied 1-standard-deviation range for ZVRA extends from approximately $9.13 on the downside to $13.01 on the upside. A ZVRA covered call collects premium on an existing long ZVRA position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether ZVRA will breach that level within the expiration window. Current ZVRA IV rank near 14.91% 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 ZVRA at 61.10%. As a Healthcare name, ZVRA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ZVRA-specific events.
ZVRA 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. ZVRA positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ZVRA alongside the broader basket even when ZVRA-specific fundamentals are unchanged. Short-premium structures like a covered call on ZVRA carry tail risk when realized volatility exceeds the implied move; review historical ZVRA earnings reactions and macro stress periods before sizing. Always rebuild the position from current ZVRA chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on ZVRA?
- A covered call on ZVRA is the covered call strategy applied to ZVRA (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 ZVRA stock trading near $11.07, the strikes shown on this page are snapped to the nearest listed ZVRA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ZVRA 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 ZVRA covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 61.10%), the computed maximum profit is $285.00 per contract and the computed maximum loss is -$914.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ZVRA covered call?
- The breakeven for the ZVRA covered call priced on this page is roughly $9.15 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 ZVRA market-implied 1-standard-deviation expected move is approximately 17.52%; 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 ZVRA?
- Covered calls on ZVRA are an income strategy run on existing ZVRA 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 ZVRA implied volatility affect this covered call?
- ZVRA ATM IV is at 61.10% with IV rank near 14.91%, 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.