Covered calls on MRK
Merck and Co. was trading at $127.40 when this page was last refreshed on August 3, 2026. 26 out-of-the-money MRK calls sat in the 0.15 to 0.25 delta band that covered call writers work in, paying $98 to $121 a contract. None of them cleared the confidence bar.
Numbers on this page come from a snapshot taken on August 3, 2026. They are not live quotes and are not refreshed when you load the page.
| Expiry | Strike | Bid / ask | Premium | Annualized | Keep odds | Break-even | OI |
|---|---|---|---|---|---|---|---|
| August 14 11d | $136.00 | $0.59 / $1.37 | $98 | 25.5% | 80% | $136.98 | 103 |
| August 21 18d | $137.00 | $1.02 / $1.19 | $111 | 17.6% | 79% | $138.10 | 239 |
| August 28 25d | $139.00 | $0.87 / $1.12 | $100 | 11.4% | 79% | $140.00 | 44 |
| September 4 32d | $141.00 | $0.70 / $1.42 | $106 | 9.5% | 80% | $142.06 | 28 |
| September 11 39d | $141.00 | $0.85 / $1.56 | $121 | 8.8% | 80% | $142.21 | 0 |
One row per expiration: the out-of-the-money strike closest to the middle of the delta band, which is the strike you would actually be looking at on that expiry. Break-even on a covered call is your own cost basis minus the premium, not the strike minus the premium, so the column above is the strike-side break-even and yours depends on what you paid for the shares.
What the premium is priced off
At-the-money implied vol is 31%. Rich, and richness has a reason: something in the next few weeks is expected to move this stock, and you are the one selling the insurance against it.
Can you actually get filled
Median bid-ask spread is 58.9% of the mid, and the worst strike here is 79.6%. At those widths the quoted premium is close to fiction. Work the order, or write a different expiry. Open interest is thin, 44 contracts at the median strike. You can get into a position like that far more easily than you can get out of it. One expiry in this ladder has almost no open interest at all (September 11), and a strike nobody else holds is a strike you will be negotiating your way out of alone.
Dates that matter in this window
Earnings land inside the 45-day window. That is the one date that reliably breaks a premium-selling trade: the stock gaps, the strike you picked on a probability model turns out to have been picked on the wrong distribution, and the vol you sold collapses to reward the buyer instead of you. The engine deducts heavily for it. An ex-dividend date also falls inside the window, and that matters more for a covered call than most people expect. A call holder sitting on an in-the-money contract can exercise early to capture the dividend, which takes your shares before expiry and before you collected the last of the time value.
What the annualized column hides
The best annualized number in this ladder is 25.5%, on the $136.00 strike expiring August 14. It is $98 of actual cash. It annualizes well because it is an 11-day contract, and annualizing a two-week trade assumes you find twenty-six more like it, at the same premium, with the same risk. You will not.
If it gets called away
Take the $141.00 strike expiring September 4. You collect $106 up front. If MRK finishes above $141.00 your 100 shares are sold there, and the 10.7% move from $127.40 up to the strike is yours as well. Everything above it is not. The model puts the odds of keeping the premium without being assigned at about 80%, which is the whole point of writing that far out.
The number nobody checks is the cost basis. If you paid more than $141.00 for these shares, that strike locks in a loss on the stock, and $106 of premium does not repair it. A covered call is only a good trade at a strike you would genuinely accept selling at.
Questions people actually ask
What is a good strike for a covered call on MRK?
The strikes above are the ones in the 0.15 to 0.25 delta band, which is where premium sellers targeting roughly an 80% chance of keeping the premium tend to sit. On the August 3, 2026 snapshot that meant $136.00 out to $141.00, depending on how far out you go. The right one for you is the lowest strike you would still be happy selling your shares at.
How much can you make selling covered calls on MRK?
The best annualized figure in the ladder above was 25.5%, and the cash it represents was $98 for one contract. Annualized numbers assume you repeat the trade all year at the same premium, which nobody does. Treat them as a way to compare expiries, not as a forecast.
Does OptionsKing recommend selling calls on MRK?
No. This page is a dated snapshot of the chain, not a recommendation, and the app itself said nothing on this ticker cleared its 75 confidence bar at the last refresh. See how the confidence gate works and the full disclaimer.
Nothing above is a recommendation. It is what the MRK chain looked like on August 3, 2026, filtered to the strikes a premium seller would look at first, and the prices have moved since you loaded this page.