SDS Covered Call Strategy

Market Data

SDS Key Data

Symbol

SDS

Name

ProShares UltraShort S&P 500

Type

ETF

Sector

Leveraged ETF

Industry

-2x S&P 500

Exchange

—

Live Price

Market Cap

—

52-Week High

—

52-Week Low

—

Strategy

Covered Calls

Access

Free Trial

About

About SDS

ProShares UltraShort S&P 500 is a publicly traded etf commonly used in covered call strategies to generate consistent income from existing positions.

Strategy

Covered calls on SDS allow shareholders to collect premium income while holding the stock. The most common approach is selling out-of-the-money calls 30-45 days to expiration (DTE) to balance premium income with potential upside. If you own 100 shares of SDS, you can sell 1 call contract per 100 shares to generate consistent monthly income.

Covered calls on SDS cap your upside at the strike price but provide downside cushion equal to the premium received.

How It Works

How to Run a Covered Call on SDS

Own 100 Shares

You must own at least 100 shares of SDS to sell 1 covered call contract. Each options contract covers exactly 100 shares.

Choose Strike and Expiry

Select a call strike above the current SDS price (OTM) and an expiry date. 30–45 DTE monthly cycles are most popular for income generation.

Sell the Call

Sell 1 call contract to collect the premium immediately into your account. This income is yours regardless of what SDS does next.

Manage at Expiry

If SDS stays below your strike, the option expires worthless and you keep the premium. If it rises above, shares get called away at the strike.

FAQ

Frequently Asked Questions

Can I sell covered calls on SDS?

Yes, SDS has listed options. You need to own 100 shares per contract. Use our screener to find the best strikes and expiries based on your goals.

What strike should I choose for SDS covered calls?

Most income traders choose strikes 2–10% above the current SDS price (OTM), balancing premium income with allowing some upside. The ideal strike depends on your income vs. upside tradeoff.

What is the best expiry for SDS covered calls?

Monthly options (30–45 DTE) have the best time-decay characteristics for covered call sellers. Weekly options on SDS offer more flexibility but require more active management.

How much premium can I collect on SDS covered calls?

Premium depends on SDS's implied volatility (IV), your chosen strike distance, and days to expiry. Higher IV means more premium. Use CoveredCalls.live to see real-time premiums and annualized returns for SDS.

What happens if SDS rises above my strike?

Your shares get called away at the strike price. You keep the premium collected plus any gain from your cost basis to the strike. You can then buy shares back and repeat the strategy.

Screen the Best SDS Covered Calls Right Now

Our screener scans SDS options every few minutes and ranks setups by annualized return, downside protection, and bid-ask spread quality.

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