Rheinmetall: How to Use Options on a Share that Costs EUR 1,139

Author: Koen Hoorelbeke, Investment and Options Strategist

Date: July 31, 2026

Overview

Rheinmetall (RHM), a German defense and automotive supplier, closed at EUR 1,139.60 on July 30, 2026, which is significantly below its 52-week high of EUR 1,988.50. The company reported preliminary second-quarter figures showing sales of EUR 3.29 billion and an operating result of EUR 562 million. The full half-year details are expected on August 6, 2026.

Options Trading Mechanics

Rheinmetall options are available on two venues:

• Standard Contract (Eurex): 100 shares per contract, worth approximately EUR 113,960.
• Mini Contract (Euronext Amsterdam): 10 shares per contract, worth approximately EUR 11,396.

The choice of contract size is crucial as it affects the strategies available to investors. A covered call strategy requires owning the underlying shares, which can be cost-prohibitive with the standard contract.

Options Strategies

1. Covered Call

Thesis: An investor holds shares and wants to generate income while being willing to sell at a higher price.

Example: Holding 10 shares, selling 1 mini call at a 1240 strike for approximately EUR 16.70 per share, yielding a premium of EUR 167.

Risk: The maximum loss is the full value of the shares minus the premium received.

2. Cash-Secured Put

Thesis: An investor does not own shares but is willing to buy at a lower price.

Example: Selling 1 mini put at a 1040 strike for approximately EUR 18.40 per share, requiring cash set aside of EUR 10,400.

Risk: The maximum loss is the strike price minus the premium received, multiplied by the contract size.

Market Considerations

Implied volatility for the options is around 46%, suggesting an expensive options market. However, realized volatility has been higher, indicating potential for significant price movement. The bid-ask spread is also a critical factor to consider, as it can erode potential profits.

Final Thoughts

Options provide investors with additional strategies to act on their views but come with risks. The choice of contract size, venue, and understanding of the bid-ask spread are essential before entering trades. Investors should conduct thorough due diligence and have a clear exit plan.