How to sell a covered call on AAPL

The position is two pieces: long 100 AAPL shares and short one call. The short call obliges you to deliver those shares at $320 if the buyer exercises, and you keep the $495 premium no matter what happens. That's the whole trade — you sold the right tail of your own position.

At August 28, 2026 expiry there are three outcomes. Below $320 the call expires worthless and you keep both the shares and the premium. Above it the shares get called away at $320, for a total return of 5.2% from $308.91 including the premium. Exactly at the strike, you keep everything and a coin flip decides assignment.

Your breakeven on the combined position sits at $303.96 — spot minus the premium collected. That is the only downside protection a covered call gives you: 1.6% of cushion. It is not a hedge.

The risk in a covered call is not the call. It is the 100 shares. Max loss on the structure is $30,396 if AAPL goes to zero, versus $30,891 if you held the shares naked — the premium is the entire difference. Anyone describing this as a "low risk" trade is describing the option leg and ignoring the equity.

AAPL goes ex-dividend on August 10, 2026. An ITM short call is a genuine early-assignment risk the day before: if the remaining extrinsic value is less than the dividend, a rational holder exercises to capture it and your shares disappear early. Check the ex-date before you sell a call that expires after it.

Liquidity is a risk, not a convenience. The moment you most want out of a short-premium position is the moment the spread is widest, and the exit price you modelled at mid will not be available.

The reference covered-call underlying, and the reason is boring in the best way: a low-20s vol that realizes close to where it implies, a dividend that makes the ex-date calendar matter, and enough open interest at round strikes that you can roll a position for years without ever touching a bad fill. The premium is not exciting; it is repeatable, which is what a covered-call underlying is for.

AAPL's Aug 28 strikes are $5 apart near the money (1.62% of spot). On a ladder that wide, "pick the 0.30 delta strike" resolves to whichever rung happens to be closest — sometimes not close at all. 32k contracts of open interest on Aug 28 is workable around the money and thin in the wings — width costs more here than the ladder suggests. 18 strikes on that expiry — 41% of the board — carry prints that agree with their own implied volatility and hold up across the ladder, and those are the strikes priced here. Penny-wide almost everywhere. If a spread will not fill near mid on Apple, the price is wrong, not the market.

Skew is inverted: the 25-delta CALL implies 1.7% more vol than the put. That is the market pricing upside risk above downside risk — a squeeze, a takeover rumour, or a crowded short. Selling calls into an inverted skew pays better than usual and is riskier than usual for exactly the same reason. The term structure is flat inside 1.5% between the two captured expiries, so there is no calendar edge to harvest and no event visibly priced into one month over the other.

At 27% ATM implied vol, the Aug 28 options are pricing a one-standard-deviation move of $22.60 over 27 days — roughly −7.3% to +7.3%, or $286.31 to $331.51. The structure above sells the part of that distribution the market thinks it will not reach. Whether that is a good trade is entirely a question of whether 7.3% is too much or too little for AAPL over 27 days — the delta table cannot answer that, and neither can we.

The specific way people lose money on AAPL: Writing calls into a September product cycle at the same delta you used in July. The distribution changes; the delta table does not tell you that.