How are PFI 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 PFI collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 17.20%), the computed maximum profit is $323.00 per contract and the computed maximum loss is -$277.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PFI collar?

The breakeven for the PFI collar priced on this page is roughly $63.77 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The PFI market-implied 1-standard-deviation expected move in the same options snapshot is approximately 4.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PFI implied volatility affect this collar?

PFI ATM IV is at 17.20% with IV rank near 0.11%, 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.

PFI Collar Strategy

PFI (Invesco Dorsey Wright Financial Momentum ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.

PFI changed its tune in February 2014 but continues to provide an alternate take on US financial firms. The old version of the fund used a multi-factor selection method coupled with a tiered equal-weighting scheme that produced a vastly different portfolio than our neutral benchmark. The new incarnation follows a Dorsey-Wright relative strength index that selects and weights stocks by price momentum. Index selection begins by creating a momentum score for each eligible stock in the financial sector. The score is based on both intermediate and long-term price movements compared to other stocks in the space. The top, at least 30 stocks, with the highest momentum scores are selected for index inclusion.

PFI (Invesco Dorsey Wright Financial Momentum ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $63.4M, a beta of 1.02 versus the broader market, a 52-week range of 51.57-64.46, average daily share volume of 9K, a public-listing history dating back to 2006, approximately 321 full-time employees. These structural characteristics shape how PFI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.02 places PFI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PFI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on PFI?

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.

PFI snapshot

As of August 14, 2026, spot at $63.77, ATM IV 17.20%, IV rank 0.11%, expected move 4.93%. The collar on PFI below is built from the August 14, 2026 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 PFI specifically: IV regime affects collar pricing on both sides; compressed PFI IV at 17.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 4.93% (roughly $3.14 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 PFI expiries trade a higher absolute premium for lower per-day decay. Position sizing on PFI should anchor to the underlying notional of $63.77 per share and to the trader's directional view on PFI etf.

PFI collar setup

The PFI collar below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With PFI at $63.77 on that close, the first option leg uses a $67.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PFI 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 PFI shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$63.77	long
Sell 1	Call	$67.00	$0.37
Buy 1	Put	$61.00	$0.37

PFI collar risk and reward

Net Premium / Debit: -$6,377.00
Max Profit (per contract): $323.00
Max Loss (per contract): -$277.00
Breakeven(s): $63.77
Risk / Reward Ratio: 1.166

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.

PFI collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on PFI. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$277.00
$14.11	-77.9%	-$277.00
$28.21	-55.8%	-$277.00
$42.31	-33.7%	-$277.00
$56.41	-11.5%	-$277.00
$70.50	+10.6%	+$323.00
$84.60	+32.7%	+$323.00
$98.70	+54.8%	+$323.00
$112.80	+76.9%	+$323.00
$126.90	+99.0%	+$323.00

When traders use collar on PFI

Collars on PFI hedge an existing long PFI 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.

PFI thesis for this collar

The market-implied 1-standard-deviation range for PFI extends from approximately $60.63 on the downside to $66.91 on the upside. A PFI collar hedges an existing long PFI 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 PFI IV rank near 0.11% 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 PFI at 17.20%. As a Financial Services name, PFI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PFI-specific events.

PFI 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. PFI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PFI alongside the broader basket even when PFI-specific fundamentals are unchanged. Always rebuild the position from current PFI chain quotes before placing a trade.

Frequently asked questions

What is a collar on PFI?: A collar on PFI is the collar strategy applied to PFI (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 PFI etf at $63.77 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed PFI chain strike and the premiums come straight from that session's bid/ask midpoint.
How are PFI 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 PFI collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 17.20%), the computed maximum profit is $323.00 per contract and the computed maximum loss is -$277.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PFI collar?: The breakeven for the PFI collar priced on this page is roughly $63.77 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The PFI market-implied 1-standard-deviation expected move in the same options snapshot is approximately 4.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on PFI?: Collars on PFI hedge an existing long PFI 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 PFI implied volatility affect this collar?: PFI ATM IV is at 17.20% with IV rank near 0.11%, 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.