Definition: Collar | Tackle Trading: The #1 rated trading education platform

Collar

The Collar is a neutral protective options strategy that involves simultaneously buying OTM Puts and selling OTM Calls against a specific holding in your portfolio (a long position). The Collar is also know as Hedge-Wrapper and is most used during earnings announcements.

STRATEGY BIAS: Neutral (Goal is protection)

STRIKE PRICES: Different

EXPIRATION DATE: According to personal rules

UNDERLYING SECURITY: Same

Risk Graph

Collar risk graph

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