Technology
NVDA
NVIDIA Corporation
Learn how to sell covered calls and cash secured puts on NVIDIA (NVDA). See expected returns, optimal strikes, and example trades for the wheel strategy.
Monthly Premium2.5-4.0%
Annualized Return30-48%
Stock Price$130-145
IV RankHigh (60-80)
Options LiquidityExcellent
Dividend Yield0.03%
Why NVDA for Covered Calls & Cash Secured Puts?
NVDA offers some of the highest option premiums among mega-cap stocks due to its volatility and AI-driven momentum. The stock has exceptional options liquidity with penny-wide spreads, making it ideal for premium sellers. As the leader in AI chips, NVDA attracts significant options trading volume.
Example Covered Call Trade
NVDACovered Call
Strike Price$150 (10% OTM)
Expiration30 days
Premium$4.20 per share
Return If Flat3.1% ($420)
Return If Called14.6% ($1,920)
Keep Probability75% keep shares
Recommended Strategy for NVDA
Sell monthly covered calls 8-12% OTM for income while maintaining upside exposure. For CSPs, target strikes 10-15% below current price to get paid while waiting for pullbacks.
Risks to Consider
- High volatility can lead to large moves against your position
- Earnings can cause 10%+ moves
- AI sentiment shifts can be dramatic
- Expensive to own 100 shares (~$13-14K)
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