Shareholders of Chevron Corporation (NYSE: CVX) can enhance their income by selling the January 2028 covered call option at a $200 strike price, currently offering a premium of $5.30. This move can yield an additional annualized return of 1.7%, boosting the total annualized return to 6.2%, assuming the stock isn’t called. The stock would need to increase by 31.8% from its current price of $151.98 for that scenario to occur. If called, shareholders would realize a total return of 35.3%.
As of mid-Wednesday trading, the overall options market reflects a preference for calls, with put volume among S&P 500 components at 556,468 contracts, compared to 1.01 million calls, resulting in a put-to-call ratio of 0.55. This is below the long-term median of 0.65, indicating strong call-buying activity.
