FDT Collar Strategy
FDT (First Trust Developed Markets ex-US AlphaDEX Fund), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The First Trust Developed Markets ex-US AlphaDEX Fund is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before the Fund's fees and expenses, of an equity index called the Nasdaq AlphaDEX Developed Markets Ex-US Index.
FDT (First Trust Developed Markets ex-US AlphaDEX Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $966.8M, a beta of 1.09 versus the broader market, a 52-week range of 62.87-100.71, average daily share volume of 140K, a public-listing history dating back to 2011. These structural characteristics shape how FDT etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.09 places FDT roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FDT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on FDT?
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 FDT snapshot
As of May 15, 2026, spot at $96.72, ATM IV 20.70%, IV rank 36.58%, expected move 5.93%. The collar on FDT 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 FDT specifically: IV regime affects collar pricing on both sides; mid-range FDT IV at 20.70% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.93% (roughly $5.74 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 FDT expiries trade a higher absolute premium for lower per-day decay. Position sizing on FDT should anchor to the underlying notional of $96.72 per share and to the trader's directional view on FDT etf.
FDT collar setup
The FDT 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 FDT near $96.72, the first option leg uses a $102.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FDT 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 FDT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $96.72 | long |
| Sell 1 | Call | $102.00 | $0.58 |
| Buy 1 | Put | $92.00 | $0.75 |
FDT collar risk and reward
- Net Premium / Debit
- -$9,689.00
- Max Profit (per contract)
- $511.00
- Max Loss (per contract)
- -$489.00
- Breakeven(s)
- $96.89
- Risk / Reward Ratio
- 1.045
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.
FDT collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on FDT. 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% | -$489.00 |
| $21.39 | -77.9% | -$489.00 |
| $42.78 | -55.8% | -$489.00 |
| $64.16 | -33.7% | -$489.00 |
| $85.55 | -11.6% | -$489.00 |
| $106.93 | +10.6% | +$511.00 |
| $128.32 | +32.7% | +$511.00 |
| $149.70 | +54.8% | +$511.00 |
| $171.08 | +76.9% | +$511.00 |
| $192.47 | +99.0% | +$511.00 |
When traders use collar on FDT
Collars on FDT hedge an existing long FDT 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.
FDT thesis for this collar
The market-implied 1-standard-deviation range for FDT extends from approximately $90.98 on the downside to $102.46 on the upside. A FDT collar hedges an existing long FDT 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 FDT IV rank near 36.58% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on FDT should anchor more to the directional view and the expected-move geometry. As a Financial Services name, FDT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FDT-specific events.
FDT 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. FDT positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FDT alongside the broader basket even when FDT-specific fundamentals are unchanged. Always rebuild the position from current FDT chain quotes before placing a trade.
Frequently asked questions
- What is a collar on FDT?
- A collar on FDT is the collar strategy applied to FDT (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 FDT etf trading near $96.72, the strikes shown on this page are snapped to the nearest listed FDT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FDT 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 FDT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 20.70%), the computed maximum profit is $511.00 per contract and the computed maximum loss is -$489.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FDT collar?
- The breakeven for the FDT collar priced on this page is roughly $96.89 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 FDT market-implied 1-standard-deviation expected move is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on FDT?
- Collars on FDT hedge an existing long FDT 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 FDT implied volatility affect this collar?
- FDT ATM IV is at 20.70% with IV rank near 36.58%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.