IBM Covered Call
Every out-of-the-money IBM 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 $245.00 strike at 4.7% over 36 days.
Open interest and pricing as of the close on 2026-09-16. Recomputed every morning before the open.
IBM covered call candidates — Oct 23, 2026, 36 days out
Strikes are picked by distance from the $237.49 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 |
|---|---|---|---|---|---|---|---|
| $245.00 | 3.2% | $11.05 | 4.7% | 47.2% | $226.44 | 7.8% | 49 |
| $250.00 | 5.3% | $9.38 | 3.9% | 40.0% | $228.12 | 9.2% | 64 |
| $260.00 | 9.5% | $6.25 | 2.6% | 26.7% | $231.24 | 12.1% | 130 |
What the $245.00 call pays at expiration
One illustrative strike — the richest premium in the table — against 100 shares bought at $237.49. Profit caps at $1,856.00 if IBM finishes above $245.00; below $226.44 the premium stops covering the loss on the stock.
| Stock at expiration | Profit / loss per share | On 100 shares |
|---|---|---|
| $178.12 | $-48.32 | $-4,832.25 |
| $192.96 | $-33.48 | $-3,347.94 |
| $207.80 | $-18.64 | $-1,863.63 |
| $222.65 | $-3.79 | $-379.31 |
| $237.49 | +$11.05 | +$1,105.00 |
| $252.33 | +$18.56 | +$1,856.00 |
| $267.18 | +$18.56 | +$1,856.00 |
| $282.02 | +$18.56 | +$1,856.00 |
| $296.86 | +$18.56 | +$1,856.00 |
When a covered call fits IBM
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 IBM 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 IBM loaded.
Questions
- What does a IBM covered call pay right now?
- The $245.00 call expiring Oct 23, 2026 (36 days out) collects $11.05 per share, 4.7% of the $237.49 share price, or 47.2% annualised if you repeat it.
- What is the break-even on a IBM covered call?
- Selling the $245.00 call against stock bought at $237.49 breaks even at $226.44 — the share price less the premium. Below that the premium no longer covers the loss on the shares.
- What happens if IBM closes above the strike?
- The shares are called away at $245.00. Total return is 7.8%: the premium plus the move from $237.49 up to the strike. Gains above the strike belong to the buyer.
More on IBM
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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.