ETF - Index
SPY
SPDR S&P 500 ETF Trust
The definitive guide to selling covered calls and cash secured puts on SPY. Safest wheel strategy with the most liquid options market.
Monthly Premium0.8-1.5%
Annualized Return10-18%
Stock Price$580-610
IV RankLow (15-30)
Options LiquidityBest in Market
Dividend Yield1.3%
Why SPY for Covered Calls & Cash Secured Puts?
SPY is the safest and most liquid option for covered calls. Diversified S&P 500 exposure eliminates single-stock risk. Options expire every day of the week, giving maximum flexibility. Ideal for conservative income investors.
Example Covered Call Trade
SPYCovered Call
Strike Price$600 (2% OTM)
Expiration30 days
Premium$5.50 per share
Return If Flat0.9% ($550)
Return If Called2.8% ($1,650)
Keep Probability68% keep shares
Recommended Strategy for SPY
Sell weekly or monthly calls 1-3% OTM for consistent income. SPY is perfect for the wheel with very predictable behavior. Consider 0DTE strategies for advanced traders.
Risks to Consider
- Lower premium than individual stocks
- Expensive to own 100 shares (~$58K)
- Still exposed to market downturns
- Opportunity cost vs growth stocks
Analyze SPY Covered Calls Now
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