FXC Collar Strategy
FXC (Invesco CurrencyShares Canadian Dollar Trust), in the Financial Services sector, (Asset Management industry), listed on AMEX.
The Invesco CurrencyShares Canadian Dollar Trust (the "trust") is designed to track the price of the Canadian dollar, and trades under the ticker symbol FXC. The Canadian dollar is the national currency of Canada and the currency of the accounts of the Bank of Canada, the Canadian Central Bank.
FXC (Invesco CurrencyShares Canadian Dollar Trust) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $74.9M, a beta of 0.52 versus the broader market, a 52-week range of 69.08-72.47, average daily share volume of 52K, a public-listing history dating back to 2006. These structural characteristics shape how FXC etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.52 indicates FXC has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. FXC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on FXC?
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 FXC snapshot
As of May 14, 2026, spot at $71.18, ATM IV 7.80%, IV rank 0.96%, expected move 2.24%. The collar on FXC 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 FXC specifically: IV regime affects collar pricing on both sides; compressed FXC IV at 7.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 2.24% (roughly $1.59 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 FXC expiries trade a higher absolute premium for lower per-day decay. Position sizing on FXC should anchor to the underlying notional of $71.18 per share and to the trader's directional view on FXC etf.
FXC collar setup
The FXC 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 FXC near $71.18, the first option leg uses a $75.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FXC 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 FXC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $71.18 | long |
| Sell 1 | Call | $75.00 | $0.08 |
| Buy 1 | Put | $68.00 | $0.43 |
FXC collar risk and reward
- Net Premium / Debit
- -$7,153.00
- Max Profit (per contract)
- $347.00
- Max Loss (per contract)
- -$353.00
- Breakeven(s)
- $71.53
- Risk / Reward Ratio
- 0.983
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.
FXC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on FXC. 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% | -$353.00 |
| $15.75 | -77.9% | -$353.00 |
| $31.48 | -55.8% | -$353.00 |
| $47.22 | -33.7% | -$353.00 |
| $62.96 | -11.5% | -$353.00 |
| $78.70 | +10.6% | +$347.00 |
| $94.43 | +32.7% | +$347.00 |
| $110.17 | +54.8% | +$347.00 |
| $125.91 | +76.9% | +$347.00 |
| $141.64 | +99.0% | +$347.00 |
When traders use collar on FXC
Collars on FXC hedge an existing long FXC 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.
FXC thesis for this collar
The market-implied 1-standard-deviation range for FXC extends from approximately $69.59 on the downside to $72.77 on the upside. A FXC collar hedges an existing long FXC 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 FXC IV rank near 0.96% 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 FXC at 7.80%. As a Financial Services name, FXC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FXC-specific events.
FXC 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. FXC positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FXC alongside the broader basket even when FXC-specific fundamentals are unchanged. Always rebuild the position from current FXC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on FXC?
- A collar on FXC is the collar strategy applied to FXC (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 FXC etf trading near $71.18, the strikes shown on this page are snapped to the nearest listed FXC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FXC 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 FXC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 7.80%), the computed maximum profit is $347.00 per contract and the computed maximum loss is -$353.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a FXC collar?
- The breakeven for the FXC collar priced on this page is roughly $71.53 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 FXC market-implied 1-standard-deviation expected move is approximately 2.24%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on FXC?
- Collars on FXC hedge an existing long FXC 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 FXC implied volatility affect this collar?
- FXC ATM IV is at 7.80% with IV rank near 0.96%, 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.