AAXJ Collar Strategy
AAXJ (iShares MSCI All Country Asia ex Japan ETF), in the Financial Services sector, (Asset Management - Global industry), listed on NASDAQ.
This exchange-traded fund, the iShares MSCI All Country Asia ex Japan ETF, endeavors to replicate the performance of a specific market index. This index is composed of equity securities from nations across Asia, specifically excluding Japan.
AAXJ (iShares MSCI All Country Asia ex Japan ETF) trades in the Financial Services sector, specifically Asset Management - Global, with a market capitalization of approximately $4.08B, a beta of 1.06 versus the broader market, a 52-week range of 85.17-124.89, average daily share volume of 663K, a public-listing history dating back to 2008. These structural characteristics shape how AAXJ etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.06 places AAXJ roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. AAXJ pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on AAXJ?
A collar pairs long stock with a protective out-of-the-money put financed by a short out-of-the-money call, capping both tails of the position around the current spot.
AAXJ snapshot
As of August 14, 2026, spot at $115.86, ATM IV 26.30%, IV rank 26.16%, expected move 7.54%. The collar on AAXJ below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this collar structure on AAXJ specifically: IV regime affects collar pricing on both sides; compressed AAXJ IV at 26.30% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.54% (roughly $8.74 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AAXJ expiries trade a higher absolute premium for lower per-day decay. Position sizing on AAXJ should anchor to the underlying notional of $115.86 per share and to the trader's directional view on AAXJ etf.
AAXJ collar setup
The AAXJ collar below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With AAXJ at $115.86 on that close, the first option leg uses a $122.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AAXJ chain at a 35-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 AAXJ shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $115.86 | long |
| Sell 1 | Call | $122.00 | $1.39 |
| Buy 1 | Put | $110.00 | $1.62 |
AAXJ collar risk and reward
- Net Premium / Debit
- -$11,609.00
- Max Profit (per contract)
- $591.00
- Max Loss (per contract)
- -$609.00
- Breakeven(s)
- $116.09
- Risk / Reward Ratio
- 0.970
Max profit roughly equals short-call strike minus cost basis plus net premium; max loss roughly equals cost basis minus long-put strike minus net premium. Breakeven shifts by the net premium.
AAXJ collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on AAXJ. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$609.00 |
| $25.63 | -77.9% | -$609.00 |
| $51.24 | -55.8% | -$609.00 |
| $76.86 | -33.7% | -$609.00 |
| $102.47 | -11.6% | -$609.00 |
| $128.09 | +10.6% | +$591.00 |
| $153.71 | +32.7% | +$591.00 |
| $179.32 | +54.8% | +$591.00 |
| $204.94 | +76.9% | +$591.00 |
| $230.56 | +99.0% | +$591.00 |
When traders use collar on AAXJ
Collars on AAXJ hedge an existing long AAXJ etf position; the long put sets a floor while the short call finances it, often run as a near-zero-cost hedge during expected volatility windows.
AAXJ thesis for this collar
The market-implied 1-standard-deviation range for AAXJ extends from approximately $107.12 on the downside to $124.60 on the upside. A AAXJ collar hedges an existing long AAXJ position with a protective put while financing the put cost via a short call; when the premiums roughly offset, the collar acts as a near-zero-cost insurance band around the current spot. Current AAXJ IV rank near 26.16% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on AAXJ at 26.30%. As a Financial Services name, AAXJ options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AAXJ-specific events.
AAXJ collar positions are structurally neutral (protective); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. AAXJ positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AAXJ alongside the broader basket even when AAXJ-specific fundamentals are unchanged. Always rebuild the position from current AAXJ chain quotes before placing a trade.
Frequently asked questions
- What is a collar on AAXJ?
- A collar on AAXJ is the collar strategy applied to AAXJ (etf). The strategy is structurally neutral (protective): A collar pairs long stock with a protective out-of-the-money put financed by a short out-of-the-money call, capping both tails of the position around the current spot. With AAXJ etf at $115.86 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed AAXJ chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are AAXJ collar max profit and max loss calculated?
- Max profit roughly equals short-call strike minus cost basis plus net premium; max loss roughly equals cost basis minus long-put strike minus net premium. Breakeven shifts by the net premium. For the AAXJ collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 26.30%), the computed maximum profit is $591.00 per contract and the computed maximum loss is -$609.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AAXJ collar?
- The breakeven for the AAXJ collar priced on this page is roughly $116.09 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The AAXJ market-implied 1-standard-deviation expected move in the same options snapshot is approximately 7.54%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on AAXJ?
- Collars on AAXJ hedge an existing long AAXJ etf position; the long put sets a floor while the short call finances it, often run as a near-zero-cost hedge during expected volatility windows.
- How does current AAXJ implied volatility affect this collar?
- AAXJ ATM IV is at 26.30% with IV rank near 26.16%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.