IEO Collar Strategy
IEO (iShares U.S. Oil & Gas Exploration & Production ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.
The iShares U.S. Oil & Gas Exploration & Production ETF seeks to track the investment results of an index composed of U.S. equities in the oil and gas exploration and production sector.
IEO (iShares U.S. Oil & Gas Exploration & Production ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $495.5M, a beta of 0.04 versus the broader market, a 52-week range of 84.22-130.5, average daily share volume of 147K, a public-listing history dating back to 2006. These structural characteristics shape how IEO etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.04 indicates IEO has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. IEO pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on IEO?
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 IEO snapshot
As of May 15, 2026, spot at $119.99, ATM IV 32.10%, IV rank 53.72%, expected move 9.20%. The collar on IEO 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 IEO specifically: IV regime affects collar pricing on both sides; mid-range IEO IV at 32.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 9.20% (roughly $11.04 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 IEO expiries trade a higher absolute premium for lower per-day decay. Position sizing on IEO should anchor to the underlying notional of $119.99 per share and to the trader's directional view on IEO etf.
IEO collar setup
The IEO 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 IEO near $119.99, the first option leg uses a $125.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed IEO 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 IEO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $119.99 | long |
| Sell 1 | Call | $125.00 | $2.43 |
| Buy 1 | Put | $115.00 | $2.88 |
IEO collar risk and reward
- Net Premium / Debit
- -$12,044.00
- Max Profit (per contract)
- $456.00
- Max Loss (per contract)
- -$544.00
- Breakeven(s)
- $120.44
- Risk / Reward Ratio
- 0.838
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.
IEO collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on IEO. 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% | -$544.00 |
| $26.54 | -77.9% | -$544.00 |
| $53.07 | -55.8% | -$544.00 |
| $79.60 | -33.7% | -$544.00 |
| $106.13 | -11.6% | -$544.00 |
| $132.66 | +10.6% | +$456.00 |
| $159.19 | +32.7% | +$456.00 |
| $185.72 | +54.8% | +$456.00 |
| $212.24 | +76.9% | +$456.00 |
| $238.77 | +99.0% | +$456.00 |
When traders use collar on IEO
Collars on IEO hedge an existing long IEO 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.
IEO thesis for this collar
The market-implied 1-standard-deviation range for IEO extends from approximately $108.95 on the downside to $131.03 on the upside. A IEO collar hedges an existing long IEO 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 IEO IV rank near 53.72% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on IEO should anchor more to the directional view and the expected-move geometry. As a Financial Services name, IEO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to IEO-specific events.
IEO 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. IEO positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move IEO alongside the broader basket even when IEO-specific fundamentals are unchanged. Always rebuild the position from current IEO chain quotes before placing a trade.
Frequently asked questions
- What is a collar on IEO?
- A collar on IEO is the collar strategy applied to IEO (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 IEO etf trading near $119.99, the strikes shown on this page are snapped to the nearest listed IEO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are IEO 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 IEO collar priced from the end-of-day chain at a 30-day expiry (ATM IV 32.10%), the computed maximum profit is $456.00 per contract and the computed maximum loss is -$544.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a IEO collar?
- The breakeven for the IEO collar priced on this page is roughly $120.44 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 IEO market-implied 1-standard-deviation expected move is approximately 9.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on IEO?
- Collars on IEO hedge an existing long IEO 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 IEO implied volatility affect this collar?
- IEO ATM IV is at 32.10% with IV rank near 53.72%, 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.