Volt#01: Generate Income
Covered Call Overwriting

Generate income through covered call overwriting

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How does it work?

A covered call position involves holding a long position in a particular asset, for example, SOL, and writing a call option on that same asset with the goal of realizing additional income from the option premium. This Volt writes covered call options on leading tokens. By selling covered call options, the profit from an increase in the price of the underlying index above the exercise price, but continues to bear the risk of a decline in the index.
The video below explains the strategy and three PnL (profit and loss) scenarios when using Friktion's Volt #01:

When should I use this strategy?

This strategy is most useful to trade some price upside on your token for consistent yield. Profits in most markets, outperforms the underlying asset in bear markets, and retains exposure to upside in bull markets.
Explore the math behind the strategy in this Medium article:
How do Covered Calls work?

How long do epochs last?

The Volt rebalances weekly at Friday 2am UTC. An epoch consists of holding a short call position until expiry. If there are net deposits, the volt will sell more options in the following week. If there are net withdrawals, the volt will sell fewer options.

What are the risks?

During extreme downward market moves, if spot price moves below the asset's strike price it may result in loss of principal. Currently the Volts are cash-settled meaning the deposits are not used to buy back the underlying asset. For insights into historical performance you can explore our Analytics page.

What is the historical performance?

All strategy performance and returns data can be easily found on our Analytics page linked below. To find a tutorial and guide for this, you can visit the Analytics page of our Documentation.


High voltage represents increased risk, defined by a higher probability of the option being exercised. In return for taking on increased risk, expected option premiums are higher, resulting in higher APYs. In flat markets, tactical traders can use Higher Voltage to gain yield.
Volt#01: High Voltage

Dive Deeper

Video from our partners at Genesis Volatility, explaining how Covered Calls are the OG form of yield farming!
Genesis Volatility