KSPY Collar Strategy
KSPY (KraneShares Hedgeye Hedged Equity Index ETF), in the Financial Services sector, (Asset Management industry), listed on AMEX.
Under normal circumstances, the fund invests at least 80% of its net assets in securities of the underlying index and other instruments that have economic characteristics similar to those in the underlying index. The underlying index is designed to track the performance of a portfolio of large cap securities that is subject to downside hedging and seeks to exhibit less volatility than would a portfolio of large cap securities alone. The fund is non-diversified.
KSPY (KraneShares Hedgeye Hedged Equity Index ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $32.6M, a beta of 0.47 versus the broader market, a 52-week range of 25.37-29.235, average daily share volume of 47K, a public-listing history dating back to 2024. These structural characteristics shape how KSPY etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.47 indicates KSPY has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. KSPY pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on KSPY?
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 KSPY snapshot
As of May 14, 2026, spot at $28.72, ATM IV 35.20%, IV rank 27.98%, expected move 10.09%. The collar on KSPY 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 35-day expiry.
Why this collar structure on KSPY specifically: IV regime affects collar pricing on both sides; compressed KSPY IV at 35.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.09% (roughly $2.90 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated KSPY expiries trade a higher absolute premium for lower per-day decay. Position sizing on KSPY should anchor to the underlying notional of $28.72 per share and to the trader's directional view on KSPY etf.
KSPY collar setup
The KSPY 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 KSPY near $28.72, the first option leg uses a $30.16 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KSPY chain at a 35-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 KSPY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $28.72 | long |
| Sell 1 | Call | $30.16 | N/A |
| Buy 1 | Put | $27.28 | N/A |
KSPY collar risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
KSPY collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on KSPY. 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.
When traders use collar on KSPY
Collars on KSPY hedge an existing long KSPY 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.
KSPY thesis for this collar
The market-implied 1-standard-deviation range for KSPY extends from approximately $25.82 on the downside to $31.62 on the upside. A KSPY collar hedges an existing long KSPY 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 KSPY IV rank near 27.98% 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 KSPY at 35.20%. As a Financial Services name, KSPY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KSPY-specific events.
KSPY 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. KSPY positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KSPY alongside the broader basket even when KSPY-specific fundamentals are unchanged. Always rebuild the position from current KSPY chain quotes before placing a trade.
Frequently asked questions
- What is a collar on KSPY?
- A collar on KSPY is the collar strategy applied to KSPY (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 KSPY etf trading near $28.72, the strikes shown on this page are snapped to the nearest listed KSPY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KSPY 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 KSPY collar priced from the end-of-day chain at a 30-day expiry (ATM IV 35.20%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KSPY collar?
- The breakeven for the KSPY collar priced on this page is no defined breakeven on the modeled curve 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 KSPY market-implied 1-standard-deviation expected move is approximately 10.09%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on KSPY?
- Collars on KSPY hedge an existing long KSPY 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 KSPY implied volatility affect this collar?
- KSPY ATM IV is at 35.20% with IV rank near 27.98%, 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.