DTD Collar Strategy
DTD (WisdomTree U.S. Total Dividend Fund), in the Financial Services sector, (Asset Management industry), listed on AMEX.
The fund invests at least 95% of its total assets (exclusive of collateral held from securities lending) will be invested in the component securities of the index and investments that have economic characteristics that are substantially identical to the economic characteristics of such component securities. The index is a fundamentally-weighted index that is comprised of U.S. companies listed on a U.S. stock market that pay regular cash dividends. The fund is non-diversified.
DTD (WisdomTree U.S. Total Dividend Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $1.58B, a beta of 0.75 versus the broader market, a 52-week range of 75.5-91.7, average daily share volume of 24K, a public-listing history dating back to 2006. These structural characteristics shape how DTD etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.75 places DTD roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. DTD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on DTD?
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.
Current DTD snapshot
As of May 15, 2026, spot at $91.37, ATM IV 24.90%, IV rank 4.19%, expected move 7.14%. The collar on DTD below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 34-day expiry.
Why this collar structure on DTD specifically: IV regime affects collar pricing on both sides; compressed DTD IV at 24.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.14% (roughly $6.52 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated DTD expiries trade a higher absolute premium for lower per-day decay. Position sizing on DTD should anchor to the underlying notional of $91.37 per share and to the trader's directional view on DTD etf.
DTD collar setup
The DTD collar below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With DTD near $91.37, the first option leg uses a $96.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed DTD chain at a 34-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 DTD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $91.37 | long |
| Sell 1 | Call | $96.00 | $1.16 |
| Buy 1 | Put | $87.00 | $1.06 |
DTD collar risk and reward
- Net Premium / Debit
- -$9,127.00
- Max Profit (per contract)
- $473.00
- Max Loss (per contract)
- -$427.00
- Breakeven(s)
- $91.27
- Risk / Reward Ratio
- 1.108
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.
DTD collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on DTD. 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% | -$427.00 |
| $20.21 | -77.9% | -$427.00 |
| $40.41 | -55.8% | -$427.00 |
| $60.61 | -33.7% | -$427.00 |
| $80.82 | -11.6% | -$427.00 |
| $101.02 | +10.6% | +$473.00 |
| $121.22 | +32.7% | +$473.00 |
| $141.42 | +54.8% | +$473.00 |
| $161.62 | +76.9% | +$473.00 |
| $181.82 | +99.0% | +$473.00 |
When traders use collar on DTD
Collars on DTD hedge an existing long DTD 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.
DTD thesis for this collar
The market-implied 1-standard-deviation range for DTD extends from approximately $84.85 on the downside to $97.89 on the upside. A DTD collar hedges an existing long DTD 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 DTD IV rank near 4.19% 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 DTD at 24.90%. As a Financial Services name, DTD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to DTD-specific events.
DTD 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. DTD positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move DTD alongside the broader basket even when DTD-specific fundamentals are unchanged. Always rebuild the position from current DTD chain quotes before placing a trade.
Frequently asked questions
- What is a collar on DTD?
- A collar on DTD is the collar strategy applied to DTD (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 DTD etf trading near $91.37, the strikes shown on this page are snapped to the nearest listed DTD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are DTD 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 DTD collar priced from the end-of-day chain at a 30-day expiry (ATM IV 24.90%), the computed maximum profit is $473.00 per contract and the computed maximum loss is -$427.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a DTD collar?
- The breakeven for the DTD collar priced on this page is roughly $91.27 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current DTD market-implied 1-standard-deviation expected move is approximately 7.14%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on DTD?
- Collars on DTD hedge an existing long DTD 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 DTD implied volatility affect this collar?
- DTD ATM IV is at 24.90% with IV rank near 4.19%, 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.