How are DBA 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 DBA collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 14.00%), the computed maximum profit is $132.50 per contract and the computed maximum loss is -$167.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a DBA collar?

The breakeven for the DBA collar priced on this page is roughly $27.67 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 DBA market-implied 1-standard-deviation expected move in the same options snapshot is approximately 4.01%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current DBA implied volatility affect this collar?

DBA ATM IV is at 14.00% with IV rank near 2.30%, 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.

DBA Collar Strategy

DBA (Invesco DB Agriculture Fund), in the Financial Services sector, (Asset Management industry), listed on AMEX.

The Invesco DB Agriculture Fund strives to replicate the directional changes, positive or negative, of the DBIQ Diversified Agriculture Index Excess Return. Its total return also incorporates interest earnings from its primary investments in U.S. Treasury securities and money market instruments, after the deduction of the Fund's operational costs. This fund is structured to provide investors with a cost-effective and straightforward pathway to invest in commodity futures. The underlying Index is a systematically constructed benchmark comprising futures contracts on several of the most liquid and actively traded agricultural commodities. It is not possible to directly invest in the Index.

DBA (Invesco DB Agriculture Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $768.4M, a beta of 0.33 versus the broader market, a 52-week range of 25.4-28.84, average daily share volume of 1.4M, a public-listing history dating back to 2007. These structural characteristics shape how DBA etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.33 indicates DBA has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. DBA pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on DBA?

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.

DBA snapshot

As of August 14, 2026, spot at $27.77, ATM IV 14.00%, IV rank 2.30%, expected move 4.01%. The collar on DBA 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 DBA specifically: IV regime affects collar pricing on both sides; compressed DBA IV at 14.00% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 4.01% (roughly $1.11 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 DBA expiries trade a higher absolute premium for lower per-day decay. Position sizing on DBA should anchor to the underlying notional of $27.77 per share and to the trader's directional view on DBA etf.

DBA collar setup

The DBA 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 DBA at $27.77 on that close, the first option leg uses a $29.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed DBA 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 DBA shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$27.77	long
Sell 1	Call	$29.00	$0.13
Buy 1	Put	$26.00	$0.03

DBA collar risk and reward

Net Premium / Debit: -$2,767.50
Max Profit (per contract): $132.50
Max Loss (per contract): -$167.50
Breakeven(s): $27.67
Risk / Reward Ratio: 0.791

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.

DBA collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on DBA. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$167.50
$6.15	-77.9%	-$167.50
$12.29	-55.8%	-$167.50
$18.43	-33.6%	-$167.50
$24.57	-11.5%	-$167.50
$30.70	+10.6%	+$132.50
$36.84	+32.7%	+$132.50
$42.98	+54.8%	+$132.50
$49.12	+76.9%	+$132.50
$55.26	+99.0%	+$132.50

When traders use collar on DBA

Collars on DBA hedge an existing long DBA 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.

DBA thesis for this collar

The market-implied 1-standard-deviation range for DBA extends from approximately $26.66 on the downside to $28.88 on the upside. A DBA collar hedges an existing long DBA 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 DBA IV rank near 2.30% 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 DBA at 14.00%. As a Financial Services name, DBA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to DBA-specific events.

DBA 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. DBA positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move DBA alongside the broader basket even when DBA-specific fundamentals are unchanged. Always rebuild the position from current DBA chain quotes before placing a trade.

Frequently asked questions

What is a collar on DBA?: A collar on DBA is the collar strategy applied to DBA (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 DBA etf at $27.77 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed DBA chain strike and the premiums come straight from that session's bid/ask midpoint.
How are DBA 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 DBA collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 14.00%), the computed maximum profit is $132.50 per contract and the computed maximum loss is -$167.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a DBA collar?: The breakeven for the DBA collar priced on this page is roughly $27.67 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 DBA market-implied 1-standard-deviation expected move in the same options snapshot is approximately 4.01%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on DBA?: Collars on DBA hedge an existing long DBA 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 DBA implied volatility affect this collar?: DBA ATM IV is at 14.00% with IV rank near 2.30%, 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.