5 Best Stocks for Covered Calls in 2026

Not every stock makes a good covered call candidate. The best stocks for selling covered calls have high options liquidity, moderate implied volatility, and stable-enough price action that you're comfortable holding through dips. Here are five characteristics to look for — plus ticker examples that fit the criteria in 2026.

What Makes a Good Covered Call Stock?

• Options liquidity. Tight bid/ask spreads and high open interest mean you get fair pricing and can exit rolls quickly. Illiquid options chains lead to slippage that eats into your premium.
• Moderate IV (25–60%).Too low and premiums aren't worth selling. Too high and the stock is likely to move violently — increasing assignment risk and unrealized losses.
• Fundamental conviction.You must be willing to hold this stock for months. Covered calls don't protect you from a 30% drawdown — they just provide a small buffer.
• Weekly expirations available. More expiration choices means more flexibility to fine-tune your DTE and strike selection.
• Dividend-paying is a bonus. Collecting dividends AND premiums maximizes income from the same capital.

5 Covered Call Stock Ideas for 2026

These are educational examples, not investment recommendations. Always do your own research.

1. Apple (AAPL)

The gold standard for covered call writing. Extremely liquid options, weekly expirations, moderate IV (typically 20–35%), and a dividend. AAPL tends to trade in ranges between product cycles, making it ideal for premium collection. The downside: IV can be low, so premiums are modest. Best for conservative sellers targeting 1–1.5% monthly.

2. AMD (AMD)

Higher IV than AAPL (typically 35–55%) means richer premiums. AMD has excellent options liquidity and tends to have strong support levels that make strike selection more predictable. The risk: AMD can move 5–10% on earnings or sector rotation, so avoid selling through earnings dates.

3. Ford (F)

A low share price ($10–$14 range) makes Ford accessible for smaller accounts. One put or covered call requires only $1,000–$1,400 in capital. IV is moderate (30–45%), options are liquid, and there's a dividend. Ford is a popular wheel strategy candidate.

4. Palantir (PLTR)

One of the highest-IV names in the large-cap space (40–70%). Premiums are rich, and the stock has a devoted holder base that tends to buy dips. The risk: PLTR can move sharply on government contract news or earnings. Best suited for aggressive premium sellers comfortable with higher volatility.

5. JPMorgan Chase (JPM)

A blue-chip financial with moderate IV (20–35%), strong dividends, and rock-solid options liquidity. JPM tends to trade in a channel, making it excellent for selling calls 5–10% OTM with 30-day expirations. Lower premium yield but high reliability.

Screening for Covered Call Candidates

Rather than picking stocks manually, use a screener that filters by delta, IV percentile, DTE, and premium yield. CoverEdge's research screener lets you filter the options chain by all of these metrics, plus adds AI-enhanced guidance that evaluates technical signals (RSI, trend) and news sentiment before you commit to a trade.

What to Avoid

• Meme stocks. GME, AMC — extreme IV but equally extreme risk of gap moves.
• Pre-revenue biotech. Binary events (FDA approvals) can wipe out months of premium in one session.
• Ultra-low-IV ETFs. SPY and QQQ have liquid options but IV is often so low that premiums barely cover commissions on small accounts.

FAQ

What IV percentile is best for covered calls?

Most premium sellers look for IV percentile above 30 and below 70. Below 30, premiums are thin. Above 70, the stock may be too volatile for a comfortable hold. CoverEdge's screener shows IV percentile for every option chain.

Should I sell covered calls on dividend stocks?

Yes — as long as you time your strike expirations around ex-dividend dates. Be aware that deep in-the-money calls near ex-div dates have higher early assignment risk.