UVXY Options Trading — Covered Calls, Puts & the Wheel
A complete guide to selling options on ProShares Ultra VIX Short-Term Futures. Expected premiums, strike selection, real example trades, and the four strategies that actually work for UVXY.
Why trade options on UVXY?
UVXY (ProShares Ultra VIX Short-Term Futures) is one of the most heavily traded ETFs for options strategies. Penny-wide bid/ask spreads and deep open interest on every strike make it ideal for premium sellers. Because UVXY is a basket rather than a single name, single-stock earnings risk is diffused, which is a meaningful edge for consistent income.
Typical monthly premium collected on UVXY runs around 3.5-6.0% of capital, which annualizes to roughly 42-72% if you sell new contracts every cycle. Capital required to run a single contract wheel on UVXY is under $5,000 — the share price and the 100-share lot size set the minimum, not the strategy.
Four strategies that work on UVXY
UVXY Covered Call
Sell upside calls against 100 shares you already own to collect premium every month while capping your upside.
Read the UVXY Covered Call guide →UVXY Cash-Secured Put
Sell a put backed by cash so you either get paid to wait or acquire the stock at a discount to today's price.
Read the UVXY Cash-Secured Put guide →UVXY Wheel
Alternate between cash-secured puts and covered calls on the same ticker to generate continuous premium income.
Read the UVXY Wheel guide →UVXY Poor Man's Covered Call
Replace the 100 shares with a long-dated deep-ITM LEAPS call and sell short-dated calls against it to reduce capital.
Read the UVXY Poor Man's Covered Call guide →UVXY options FAQ
What is the best strike price for a UVXY covered call?
On UVXY, target 12-18% out of the money at 0.10-0.20 delta. On a very high-volatility stock like this, closer-to-the-money strikes chase premium but spike assignment probability to uncomfortable levels.
How much premium can I collect selling calls on UVXY?
Typical monthly premium on UVXY is 3.5-6.0% of position value, annualizing to 42-72% when you roll every cycle. Earnings months can pay 2-3x the normal rate because of elevated IV.
What is the best delta for a UVXY cash-secured put?
A delta of 0.10-0.20 on UVXY balances premium income with assignment probability. Lower delta is warranted here because a single gap down can drop the stock 10%+
How much cash do I need to sell a put on UVXY?
Cash required is 100 × strike price. For UVXY, that's roughly under $5,000 per contract at a typical strike. Most brokers let you use margin, but for a true cash-secured put you set aside the full amount.
Is UVXY a good stock for the wheel strategy?
UVXY is excellent for the wheel because of its penny-wide spreads and elevated IV (high premium, higher assignment risk). No dividend means all your return comes from premiums and price appreciation.
Can you run a poor man's covered call on UVXY?
Yes. Buy a 0.80+ delta LEAPS on UVXY dated 12-18 months out as your synthetic long, then sell short-dated calls 12-18% above the stock at 0.10-0.20 delta. Capital tied up drops from under $5,000 to roughly 30-50% of that — a meaningful improvement when the share price is a low share price.
What expiration should I use for UVXY options strategy trades?
Use 14-28 DTE so you can react to sharp IV crushes and moves as a default for UVXY. Shorter expirations let you react to IV resets and price gaps.
Is UVXY suitable for beginners selling options?
Not ideal for beginners. Smaller-cap names can have wider spreads and sharper moves. Start with large caps or major ETFs first.
Run the numbers on UVXY yourself
Use the free OptionsPilot calculator to price covered calls and cash-secured puts on UVXY with live quotes.
Open the UVXY Strike Finder →