HDGE Collar Strategy
HDGE (AdvisorShares Ranger Equity Bear ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.
The Sub-Advisor seeks to achieve the fund's investment objective by short selling a portfolio of liquid mid- and large-cap U.S. exchange-traded equity securities, ETFs, ETNs and other exchange-traded products. The fund invests at least 80% of its net assets, plus any borrowings for investment purposes, in short positions in equity securities. The Sub-Advisor implements a bottom-up, fundamental, research driven security selection process.
HDGE (AdvisorShares Ranger Equity Bear ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $57.1M, a beta of -1.21 versus the broader market, a 52-week range of 15.62-18.45, average daily share volume of 226K, a public-listing history dating back to 2011. These structural characteristics shape how HDGE etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -1.21 indicates HDGE has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. HDGE pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on HDGE?
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 HDGE snapshot
As of May 15, 2026, spot at $17.59, ATM IV 29.90%, IV rank 3.63%, expected move 8.57%. The collar on HDGE 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 HDGE specifically: IV regime affects collar pricing on both sides; compressed HDGE IV at 29.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 8.57% (roughly $1.51 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 HDGE expiries trade a higher absolute premium for lower per-day decay. Position sizing on HDGE should anchor to the underlying notional of $17.59 per share and to the trader's directional view on HDGE etf.
HDGE collar setup
The HDGE 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 HDGE near $17.59, the first option leg uses a $18.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HDGE 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 HDGE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $17.59 | long |
| Sell 1 | Call | $18.00 | $0.53 |
| Buy 1 | Put | $17.00 | $0.32 |
HDGE collar risk and reward
- Net Premium / Debit
- -$1,738.50
- Max Profit (per contract)
- $61.50
- Max Loss (per contract)
- -$38.50
- Breakeven(s)
- $17.39
- Risk / Reward Ratio
- 1.597
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.
HDGE collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on HDGE. 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 | -99.9% | -$38.50 |
| $3.90 | -77.8% | -$38.50 |
| $7.79 | -55.7% | -$38.50 |
| $11.67 | -33.6% | -$38.50 |
| $15.56 | -11.5% | -$38.50 |
| $19.45 | +10.6% | +$61.50 |
| $23.34 | +32.7% | +$61.50 |
| $27.23 | +54.8% | +$61.50 |
| $31.12 | +76.9% | +$61.50 |
| $35.00 | +99.0% | +$61.50 |
When traders use collar on HDGE
Collars on HDGE hedge an existing long HDGE 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.
HDGE thesis for this collar
The market-implied 1-standard-deviation range for HDGE extends from approximately $16.08 on the downside to $19.10 on the upside. A HDGE collar hedges an existing long HDGE 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 HDGE IV rank near 3.63% 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 HDGE at 29.90%. As a Financial Services name, HDGE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HDGE-specific events.
HDGE 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. HDGE positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move HDGE alongside the broader basket even when HDGE-specific fundamentals are unchanged. Always rebuild the position from current HDGE chain quotes before placing a trade.
Frequently asked questions
- What is a collar on HDGE?
- A collar on HDGE is the collar strategy applied to HDGE (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 HDGE etf trading near $17.59, the strikes shown on this page are snapped to the nearest listed HDGE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are HDGE 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 HDGE collar priced from the end-of-day chain at a 30-day expiry (ATM IV 29.90%), the computed maximum profit is $61.50 per contract and the computed maximum loss is -$38.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a HDGE collar?
- The breakeven for the HDGE collar priced on this page is roughly $17.39 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 HDGE market-implied 1-standard-deviation expected move is approximately 8.57%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on HDGE?
- Collars on HDGE hedge an existing long HDGE 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 HDGE implied volatility affect this collar?
- HDGE ATM IV is at 29.90% with IV rank near 3.63%, 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.