FMAG Collar Strategy
FMAG (Fidelity Magellan ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.
Opportunistically invests in high-quality cyclical growth stocks and steady growers that seek to benefit from long-term megatrends.
FMAG (Fidelity Magellan ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $254.1M, a beta of 1.12 versus the broader market, a 52-week range of 30.49-36.33, average daily share volume of 25K, a public-listing history dating back to 2021. These structural characteristics shape how FMAG etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.12 places FMAG roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FMAG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on FMAG?
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 FMAG snapshot
As of May 15, 2026, spot at $36.08, ATM IV 29.10%, expected move 8.34%. The collar on FMAG 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 FMAG specifically: IV rank is unavailable in the current snapshot, so regime-based timing for FMAG is inferred from ATM IV at 29.10% alone, with a market-implied 1-standard-deviation move of approximately 8.34% (roughly $3.01 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 FMAG expiries trade a higher absolute premium for lower per-day decay. Position sizing on FMAG should anchor to the underlying notional of $36.08 per share and to the trader's directional view on FMAG etf.
FMAG collar setup
The FMAG 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 FMAG near $36.08, the first option leg uses a $38.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FMAG 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 FMAG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $36.08 | long |
| Sell 1 | Call | $38.00 | $0.62 |
| Buy 1 | Put | $34.00 | $0.48 |
FMAG collar risk and reward
- Net Premium / Debit
- -$3,594.00
- Max Profit (per contract)
- $206.00
- Max Loss (per contract)
- -$194.00
- Breakeven(s)
- $35.94
- Risk / Reward Ratio
- 1.062
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.
FMAG collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on FMAG. 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% | -$194.00 |
| $7.99 | -77.9% | -$194.00 |
| $15.96 | -55.8% | -$194.00 |
| $23.94 | -33.6% | -$194.00 |
| $31.92 | -11.5% | -$194.00 |
| $39.89 | +10.6% | +$206.00 |
| $47.87 | +32.7% | +$206.00 |
| $55.84 | +54.8% | +$206.00 |
| $63.82 | +76.9% | +$206.00 |
| $71.80 | +99.0% | +$206.00 |
When traders use collar on FMAG
Collars on FMAG hedge an existing long FMAG 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.
FMAG thesis for this collar
The market-implied 1-standard-deviation range for FMAG extends from approximately $33.07 on the downside to $39.09 on the upside. A FMAG collar hedges an existing long FMAG 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. As a Financial Services name, FMAG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FMAG-specific events.
FMAG 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. FMAG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FMAG alongside the broader basket even when FMAG-specific fundamentals are unchanged. Always rebuild the position from current FMAG chain quotes before placing a trade.
Frequently asked questions
- What is a collar on FMAG?
- A collar on FMAG is the collar strategy applied to FMAG (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 FMAG etf trading near $36.08, the strikes shown on this page are snapped to the nearest listed FMAG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FMAG 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 FMAG collar priced from the end-of-day chain at a 30-day expiry (ATM IV 29.10%), the computed maximum profit is $206.00 per contract and the computed maximum loss is -$194.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FMAG collar?
- The breakeven for the FMAG collar priced on this page is roughly $35.94 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 FMAG market-implied 1-standard-deviation expected move is approximately 8.34%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on FMAG?
- Collars on FMAG hedge an existing long FMAG 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 FMAG implied volatility affect this collar?
- Current FMAG ATM IV is 29.10%; IV rank context is unavailable in the current snapshot.