MAGY Collar Strategy
MAGY (Roundhill Investments - Magnificent Seven Covered Call ETF), in the Financial Services sector, (Asset Management - Income industry), listed on CBOE.
The Roundhill Magnificent Seven Covered Call ETF (“MAGY”) implements a covered call strategy on the “Magnificent Seven” stocks. The Fund offers exposure to the Magnificent Seven, subject to a cap, while providing the potential for current income. MAGY is an actively-managed ETF.
MAGY (Roundhill Investments - Magnificent Seven Covered Call ETF) trades in the Financial Services sector, specifically Asset Management - Income, with a market capitalization of approximately $95.4M, a beta of 0.91 versus the broader market, a 52-week range of 43.01-58.34, average daily share volume of 90K, a public-listing history dating back to 2025. These structural characteristics shape how MAGY etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.91 places MAGY roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. MAGY pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on MAGY?
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 MAGY snapshot
As of May 15, 2026, spot at $47.31, ATM IV 28.80%, IV rank 4.65%, expected move 8.26%. The collar on MAGY 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 MAGY specifically: IV regime affects collar pricing on both sides; compressed MAGY IV at 28.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 8.26% (roughly $3.91 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 MAGY expiries trade a higher absolute premium for lower per-day decay. Position sizing on MAGY should anchor to the underlying notional of $47.31 per share and to the trader's directional view on MAGY etf.
MAGY collar setup
The MAGY 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 MAGY near $47.31, the first option leg uses a $50.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MAGY 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 MAGY shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $47.31 | long |
| Sell 1 | Call | $50.00 | $0.38 |
| Buy 1 | Put | $45.00 | $0.73 |
MAGY collar risk and reward
- Net Premium / Debit
- -$4,765.50
- Max Profit (per contract)
- $234.50
- Max Loss (per contract)
- -$265.50
- Breakeven(s)
- $47.66
- Risk / Reward Ratio
- 0.883
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.
MAGY collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on MAGY. 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% | -$265.50 |
| $10.47 | -77.9% | -$265.50 |
| $20.93 | -55.8% | -$265.50 |
| $31.39 | -33.7% | -$265.50 |
| $41.85 | -11.5% | -$265.50 |
| $52.31 | +10.6% | +$234.50 |
| $62.77 | +32.7% | +$234.50 |
| $73.23 | +54.8% | +$234.50 |
| $83.69 | +76.9% | +$234.50 |
| $94.14 | +99.0% | +$234.50 |
When traders use collar on MAGY
Collars on MAGY hedge an existing long MAGY 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.
MAGY thesis for this collar
The market-implied 1-standard-deviation range for MAGY extends from approximately $43.40 on the downside to $51.22 on the upside. A MAGY collar hedges an existing long MAGY 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 MAGY IV rank near 4.65% 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 MAGY at 28.80%. As a Financial Services name, MAGY options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MAGY-specific events.
MAGY 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. MAGY positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MAGY alongside the broader basket even when MAGY-specific fundamentals are unchanged. Always rebuild the position from current MAGY chain quotes before placing a trade.
Frequently asked questions
- What is a collar on MAGY?
- A collar on MAGY is the collar strategy applied to MAGY (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 MAGY etf trading near $47.31, the strikes shown on this page are snapped to the nearest listed MAGY chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MAGY 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 MAGY collar priced from the end-of-day chain at a 30-day expiry (ATM IV 28.80%), the computed maximum profit is $234.50 per contract and the computed maximum loss is -$265.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MAGY collar?
- The breakeven for the MAGY collar priced on this page is roughly $47.66 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 MAGY market-implied 1-standard-deviation expected move is approximately 8.26%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on MAGY?
- Collars on MAGY hedge an existing long MAGY 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 MAGY implied volatility affect this collar?
- MAGY ATM IV is at 28.80% with IV rank near 4.65%, 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.