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Own UBER? Get Paid 13%/Year to Hold It
How to Get Paid Cash Now on Your Uber Shares (While Still Keeping the Upside)
ELI5 Version: Imagine you own a lemonade stand. Someone pays you $5 today for the right to buy your stand for $100 next summer. You keep the $5 no matter what. If your stand is worth $90 next summer, they walk away—you keep the $5 and your stand. If it’s worth $110, they buy it for $100—you keep the $5 plus the $100. Either way, that $5 is yours forever.
What Is a Covered Call? (The Super Simple Version)
Think of it like renting out your stock.
- You own 100 shares of a company (like Uber).
- You sell a promise (a "call option") to someone else.
- That promise says: "If the stock hits $X by [date], you can buy my shares for $X."
- In exchange, they pay you cash upfront (called a premium).
- You keep that cash no matter what happens.
Why "covered"? Because you actually own the shares—you’re "covered" if they want to buy them.
The Uber Trade: Real Numbers, Right Now
As of the time of this writing, Uber (UBER) trades around $70.36. It’s been a bumpy ride—down ~30% from its 52-week high. But you can generate income today while you wait for a recovery.
The Setup (Step-by-Step)
- Own (or buy) 100 shares of UBER → Cost: ~$7,036
- Sell 1 call option expiring June 17, 2027 (about 321 days out)
- Strike price: $80 → That’s ~14% above today’s price
- Collect ~$795 in premium (cash in your account immediately)
- That $795 = ~12.9% annualized yield on your $7,036 investment
Important: Each option contract = 100 shares. So 1 contract = your 100 shares.
Two Outcomes — You Win Either Way
| Scenario | What Happens | Your Result |
|---|---|---|
| UBER stays below $80 by 6/17/2027 | Option expires worthless | Keep $795 premium + all 100 shares → ~11% return in <1 year. Do it again! |
| UBER goes above $80 | Shares "called away" at $80 | Keep $795 premium + $8,000 from sale = $8,795 total → ~25% gain (~29% annualized). You miss gains above $80. |
Trade-off: You cap your upside at $80. If UBER hits $100, you still sell at $80. But you locked in a 25%+ gain.
Why This Makes Sense for Uber Right Now
The Bull Case (Why UBER Could Soar)
- Gross bookings up 21% YoY last quarter
- 50M+ Uber One members — they spend 3x more than regular users
- Autonomous vehicle network play — Uber wants to be the platform for robotaxis (capital-light, high-margin)
- New services + loyal users = cross-sell engine for future profits
The Bear Case (Why It Might Not)
- Waymo & others building their own robotaxi fleets = direct competition
- AI agents (from Google, Apple, etc.) could bypass Uber entirely — turn it into a "dumb pipe" with razor-thin margins
- These risks explain why the stock hasn’t rallied despite good numbers
The Real Question You Have to Ask Yourself
"Would I be happy selling my Uber shares at $80 — a ~14% premium to today — and walking away with a 25%+ total return?"
- If YES → This trade is a no-brainer. You get paid to say "yes."
- If NO (you need $100+ to feel good) → Don’t sell the call. Or pick a higher strike (less premium, more room).
Don’t Own Uber? No Problem — Check Your Whole Portfolio
You can do this on almost any stock you own (if it has options).
Tool: Trefis Covered Call Finder
→ Type in your tickers → See instant income estimates → Slide the strike to balance more cash vs. more upside
Where This Fits in a Bigger Plan
One stock = one pillar. A portfolio = a house.
A covered call on Uber is smart tactical income. But durable wealth comes from:
- 30+ high-quality companies across sectors
- No single name or theme decides your year
- Rebalanced with discipline
That’s the Trefis High Quality (HQ) Portfolio — built on fundamentals, not hype.
It’s beaten a blended benchmark (S&P 500 + MidCap + Russell 2000) over time.
Strategy: Own the HQ core. Layer covered calls on top for extra cash flow.
Summary
- Sell a covered call on UBER → Collect $795 now (12.9% annualized)
- Keep the cash no matter what
- If stock < $80 → Keep shares + premium → Repeat
- If stock > $80 → Sell at $80 + premium → 25%+ gain (capped upside)
- Decide: Is $80 a "happy exit" for you?
- Use the Call Finder to scan your whole portfolio
- Build a diversified core (like HQ Portfolio) + add calls for income
FAQ
What if Uber crashes below $60? Do I lose money?
Yes, on the shares. The $795 premium cushions the fall (lowers your cost basis to ~$62.41), but you still ride the drop. Covered calls don’t protect against big declines — they just pay you to hold.
Can I do this in an IRA or 401(k)?
Usually yes, if your broker allows options trading (typically "Level 1" or "Covered Call" approval). Check with your provider.
What happens to dividends?
You still get them! As long as you own the shares on the ex-dividend date, the dividend is yours. The call seller doesn’t get it.
Can I buy back the call early if I change my mind?
Yes. You can "buy to close" the option anytime before expiration. If the stock drops, the call loses value — you might buy it back for less than you sold it for, pocketing the difference and keeping your shares.
Is this "free money"?
No free lunch. You’re trading unlimited upside for guaranteed income now. It’s a choice, not a cheat code. But for sideways/slightly-up markets, it’s a powerful tool.
Want to see what your portfolio could pay you? Try the Covered Call Finder — plug in your tickers, slide the strike, and see the cash waiting on the table.
