KEMX Collar Strategy
KEMX (KraneShares MSCI Emerging Markets ex China Index ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
Under normal circumstances, the fund will invest at least 80% of its net assets (plus borrowings for investment purposes) in instruments in its underlying index or in instruments that have economic characteristics similar to those in the underlying index. The underlying index is a free float-adjusted market capitalization weighted index designed to measure the equity market performance of mid- and large-cap companies of emerging market countries, excluding China.
KEMX (KraneShares MSCI Emerging Markets ex China Index ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $117.0M, a beta of 1.23 versus the broader market, a 52-week range of 29.92-50.179, average daily share volume of 28K, a public-listing history dating back to 2019. These structural characteristics shape how KEMX etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.23 places KEMX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. KEMX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on KEMX?
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 KEMX snapshot
As of May 13, 2026, spot at $48.93, ATM IV 31.60%, IV rank 9.70%, expected move 9.06%. The collar on KEMX 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 KEMX specifically: IV regime affects collar pricing on both sides; compressed KEMX IV at 31.60% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 9.06% (roughly $4.43 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 KEMX expiries trade a higher absolute premium for lower per-day decay. Position sizing on KEMX should anchor to the underlying notional of $48.93 per share and to the trader's directional view on KEMX etf.
KEMX collar setup
The KEMX 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 KEMX near $48.93, the first option leg uses a $51.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KEMX 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 KEMX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $48.93 | long |
| Sell 1 | Call | $51.00 | $1.03 |
| Buy 1 | Put | $46.00 | $1.25 |
KEMX collar risk and reward
- Net Premium / Debit
- -$4,915.00
- Max Profit (per contract)
- $185.00
- Max Loss (per contract)
- -$315.00
- Breakeven(s)
- $49.15
- Risk / Reward Ratio
- 0.587
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.
KEMX collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on KEMX. 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% | -$315.00 |
| $10.83 | -77.9% | -$315.00 |
| $21.65 | -55.8% | -$315.00 |
| $32.46 | -33.7% | -$315.00 |
| $43.28 | -11.5% | -$315.00 |
| $54.10 | +10.6% | +$185.00 |
| $64.92 | +32.7% | +$185.00 |
| $75.73 | +54.8% | +$185.00 |
| $86.55 | +76.9% | +$185.00 |
| $97.37 | +99.0% | +$185.00 |
When traders use collar on KEMX
Collars on KEMX hedge an existing long KEMX 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.
KEMX thesis for this collar
The market-implied 1-standard-deviation range for KEMX extends from approximately $44.50 on the downside to $53.36 on the upside. A KEMX collar hedges an existing long KEMX 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 KEMX IV rank near 9.70% 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 KEMX at 31.60%. As a Financial Services name, KEMX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KEMX-specific events.
KEMX 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. KEMX positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KEMX alongside the broader basket even when KEMX-specific fundamentals are unchanged. Always rebuild the position from current KEMX chain quotes before placing a trade.
Frequently asked questions
- What is a collar on KEMX?
- A collar on KEMX is the collar strategy applied to KEMX (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 KEMX etf trading near $48.93, the strikes shown on this page are snapped to the nearest listed KEMX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KEMX 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 KEMX collar priced from the end-of-day chain at a 30-day expiry (ATM IV 31.60%), the computed maximum profit is $185.00 per contract and the computed maximum loss is -$315.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KEMX collar?
- The breakeven for the KEMX collar priced on this page is roughly $49.15 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 KEMX market-implied 1-standard-deviation expected move is approximately 9.06%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on KEMX?
- Collars on KEMX hedge an existing long KEMX 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 KEMX implied volatility affect this collar?
- KEMX ATM IV is at 31.60% with IV rank near 9.70%, 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.