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UPRO fell 5.5% on roll day, and the iPMCC still made $196
UPRO dropped 5.5% on Friday, the day the iPMCC's first weekly call expired. The in-the-money short call absorbed the fall, and the week closed $195.57 up. The rules rolled to a November 6 134 call and moved the long call down to the 110 strike.
By Team Iron Wheel
UPRO fell 5.5% on Friday, October 30, the day the iPMCC's first weekly call expired. The pair made money anyway. The week closed $195.57 up, 6.4% on the debit, because the in-the-money part of the short call absorbed the drop. The rules rolled the short call to next week and moved the long call down to the 110 strike. The figures are from The Iron Wheel at Friday's close. It is an example for education, not a recommendation.
| At a glance | |
|---|---|
| Realized this week | +$195.57, 6.4% on the debit |
| Short call | Nov 6 134, sold at $8.28 |
| Long call | Mar 19 110, bought at $37.19 |
| Max profit next week | About $490, with UPRO at $134 |
| Break-even | About $128 and $177 on November 6 |
| Max loss | $2,696.71 |
| Capital | $2,960 |
| Next roll | Friday, November 6 |
The market: a red Friday
SPY fell 1.8% on Friday. UPRO, built to move about three times as far, fell 5.5%. It closed at $141.21, after touching $138.13.
VIX touched 23.93 during the day and closed at 19.42. CNN's Fear & Greed index for stocks dropped from 35 to 26, in fear.
How the pair held up
At the Week 2 review, the pair was up $54.90 with UPRO at $149.55. After one more gain on Wednesday, UPRO slid. By the roll, at 3:46 pm ET, it was at about $140. The two closed legs made $195.57 between them.
- The short 140 call: sold for $7.18, bought back for $0.52. It kept 93% of its price, a gain of $664.71.
- The long 115 call: bought for $37.91, sold for $33.24, a loss of $469.14.
- 100 shares of UPRO would have lost about $500 over the same move, from about $145 to $140.
About $5 of the short call's price was in the money at the fill. As UPRO fell to $140, that $5 drained out of the call, and the pair kept it. The long call lost about the same $5 of intrinsic value, so the two cancelled out.
What was left was time value. The short call shed about $1.50 of it, and the long call gained about 50 cents. Before commissions the pair made $1.99 a share, close to the $2 that the first post said the week was selling.
Against the estimate
The first post's profile put this week's best case at about $250, with UPRO at $140 on October 30. UPRO was at about $140 when the roll went in. Almost all of the gap is the $52.23 spent buying back the short call.
Waiting for expiration would have been worse. UPRO bounced to $141.21 by the close, above the 140 strike, and the call would have been assigned.
The roll
Both trades went in during the session's last 15 minutes, as the new routine has it. The roll came first.
| Order | Price | Commission | Net |
|---|---|---|---|
| Buy 1 UPRO Oct 30 2026 140 call | $0.52 | $0.23 | $52.23 debit |
| Sell 1 UPRO Nov 6 2026 134 call | $8.28 | $0.25 | $827.75 credit |
Net credit: $775.52.
The strike moved down with UPRO, from 140 to 134. The new call is 7 days out at about 0.71 delta, by a Black-Scholes estimate. With UPRO at $140, it was $6 in the money. The other $2.28 of its price is time value, and that's what next week sells.
The long call moves down
A minute later, the long call moved down a strike.
| Order | Price | Commission | Net |
|---|---|---|---|
| Sell 1 UPRO Mar 19 2027 115 call | $33.24 | $1.10 | $3,322.90 credit |
| Buy 1 UPRO Mar 19 2027 110 call | $37.19 | $1.03 | $3,720.03 debit |
Net debit: $397.13.
The Week 2 review had flagged the long call at 0.83 delta, outside its 77–82 band. By Friday the drop had pulled it back to about 0.79, just inside. The swap went ahead with the roll.
The new 110 call sits at 0.82, about 11 delta above the new short call, the gap the band exists to keep. At the fill, the pair moved like 11 shares of UPRO.
Where it stands
UPRO bounced in the last 15 minutes and closed at $141.21. The new pair finished the day up $67.72, which puts the campaign up $263.29.
No rule applies until the next roll. The short call has a week to run, and the long call is inside its band.
Max profit, max loss and break-even
These figures come from the app's P/L profile, which prices the long call at Friday's implied volatility. They count the $195.57 already banked, and they're estimates.
- Max profit next week: about $490, with UPRO at $134 on November 6. The short call expires worthless there, and the long call keeps about $8 of time value.
- Break-even: about $128 and about $177 on November 6. Between the two, the campaign is in the black.
- Max loss: $2,696.71, with UPRO below $110 when the long call expires in March. That's the open legs' $2,892.28 debit, less the realized gain, and it leaves out the weekly rolls still to come.
- Above about $177, the campaign is in the red. The pair can't be worth much more than the $24 between the strikes, and the open legs cost $28.92 a share.
Most the open legs can lose on a rally = debit − strike width = $2,892.28 − $2,400 = $492.28
Counting the realized gain, that ceiling drops to $296.71.
The plan
- Friday, November 6. The 134 call rolls to next week's 70-delta call in the session's last 30 minutes, or sooner if its time value drops below $0.05.
- The long call. If its delta leaves 77–82, the rules swap it for a new 80-delta call.
- Next week. The weekly review covers all three campaigns.