BABA Covered Call
Every out-of-the-money BABA call expiring Oct 23, 2026, priced from the settled chain: what it pays, what it yields, and where the trade stops making money. The richest right now is the $110.00 strike at 4.3% over 36 days.
Open interest and pricing as of the close on 2026-09-16. Recomputed every morning before the open.
BABA covered call candidates — Oct 23, 2026, 36 days out
Strikes are picked by distance from the $107.27 share price, not by delta — the published chain carries premiums and open interest, not greeks, and inventing a delta here would be inventing data. Premium is the bid/ask midpoint where both sides quote, otherwise the last trade. The chain artifact publishes the six nearest expirations, so this is the longest one listed — 36 days out. Annualising anything shorter than a week says more about compounding arithmetic than about the trade, so those cells stay blank.
| Strike | % OTM | Premium | Yield | Annualised | Break-even | If assigned | OI |
|---|---|---|---|---|---|---|---|
| $110.00 | 2.5% | $4.57 | 4.3% | 43.2% | $102.70 | 6.8% | 38 |
| $113.00 | 5.3% | $3.47 | 3.2% | 32.8% | $103.80 | 8.6% | 8 |
| $118.00 | 10.0% | $2.28 | 2.1% | 21.5% | $104.99 | 12.1% | 6 |
What the $110.00 call pays at expiration
One illustrative strike — the richest premium in the table — against 100 shares bought at $107.27. Profit caps at $730.50 if BABA finishes above $110.00; below $102.70 the premium stops covering the loss on the stock.
| Stock at expiration | Profit / loss per share | On 100 shares |
|---|---|---|
| $80.45 | $-22.24 | $-2,224.25 |
| $87.16 | $-15.54 | $-1,553.81 |
| $93.86 | $-8.83 | $-883.37 |
| $100.57 | $-2.13 | $-212.94 |
| $107.27 | +$4.58 | +$457.50 |
| $113.97 | +$7.31 | +$730.50 |
| $120.68 | +$7.31 | +$730.50 |
| $127.38 | +$7.31 | +$730.50 |
| $134.09 | +$7.31 | +$730.50 |
When a covered call fits BABA
A covered call sells someone else the right to buy your shares at the strike. It pays you today and caps your upside there, so it suits a holding you are content to own flat and content to sell at the strike — not one you expect to run.
The premium is compensation for implied volatility. Rich implied volatility pays more, and usually pays more because the market expects a move; a high annualised number on a name about to report earnings is a warning as often as an opportunity. Check the BABA expected move and the open-interest walls before assuming the strike is far enough away.
Full mechanics, assignment and rolling are in the covered call guide; to model a different strike or a multi-leg version, open the profit calculator with BABA loaded.
Questions
- What does a BABA covered call pay right now?
- The $110.00 call expiring Oct 23, 2026 (36 days out) collects $4.57 per share, 4.3% of the $107.27 share price, or 43.2% annualised if you repeat it.
- What is the break-even on a BABA covered call?
- Selling the $110.00 call against stock bought at $107.27 breaks even at $102.70 — the share price less the premium. Below that the premium no longer covers the loss on the shares.
- What happens if BABA closes above the strike?
- The shares are called away at $110.00. Total return is 6.8%: the premium plus the move from $107.27 up to the strike. Gains above the strike belong to the buyer.
More on BABA
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Educational, not investment advice. Options involve risk. Open interest is reported with a one-session lag by OCC, so these levels describe positioning as of the last settled session, not live intraday flow.