NFRA Collar Strategy
NFRA (FlexShares STOXX Global Broad Infrastructure Index Fund), in the Financial Services sector, (Asset Management - Global industry), listed on AMEX.
For investors seeking the potential of an expanded definition of global infrastructure.FlexShares STOXX Global Broad Infrastructure Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the STOXX Global Broad Infrastructure Index (Underlying Index).
NFRA (FlexShares STOXX Global Broad Infrastructure Index Fund) trades in the Financial Services sector, specifically Asset Management - Global, with a market capitalization of approximately $3.06B, a beta of 0.72 versus the broader market, a 52-week range of 59.6-67.36, average daily share volume of 56K, a public-listing history dating back to 2013. These structural characteristics shape how NFRA etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.72 places NFRA roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. NFRA pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on NFRA?
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 NFRA snapshot
As of May 15, 2026, spot at $64.67, ATM IV 27.80%, IV rank 14.12%, expected move 7.97%. The collar on NFRA 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 NFRA specifically: IV regime affects collar pricing on both sides; compressed NFRA IV at 27.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.97% (roughly $5.15 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 NFRA expiries trade a higher absolute premium for lower per-day decay. Position sizing on NFRA should anchor to the underlying notional of $64.67 per share and to the trader's directional view on NFRA etf.
NFRA collar setup
The NFRA 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 NFRA near $64.67, the first option leg uses a $67.90 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NFRA 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 NFRA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $64.67 | long |
| Sell 1 | Call | $67.90 | N/A |
| Buy 1 | Put | $61.44 | N/A |
NFRA 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.
NFRA collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on NFRA. 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 NFRA
Collars on NFRA hedge an existing long NFRA 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.
NFRA thesis for this collar
The market-implied 1-standard-deviation range for NFRA extends from approximately $59.52 on the downside to $69.82 on the upside. A NFRA collar hedges an existing long NFRA 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 NFRA IV rank near 14.12% 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 NFRA at 27.80%. As a Financial Services name, NFRA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NFRA-specific events.
NFRA 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. NFRA positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NFRA alongside the broader basket even when NFRA-specific fundamentals are unchanged. Always rebuild the position from current NFRA chain quotes before placing a trade.
Frequently asked questions
- What is a collar on NFRA?
- A collar on NFRA is the collar strategy applied to NFRA (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 NFRA etf trading near $64.67, the strikes shown on this page are snapped to the nearest listed NFRA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NFRA 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 NFRA collar priced from the end-of-day chain at a 30-day expiry (ATM IV 27.80%), 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 NFRA collar?
- The breakeven for the NFRA 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 NFRA market-implied 1-standard-deviation expected move is approximately 7.97%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on NFRA?
- Collars on NFRA hedge an existing long NFRA 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 NFRA implied volatility affect this collar?
- NFRA ATM IV is at 27.80% with IV rank near 14.12%, 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.