PSCI Collar Strategy
PSCI (Invesco S&P SmallCap Industrials ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The fund generally will invest at least 90% of its total assets in the securities that comprise the index. Strictly in accordance with its guidelines and mandated procedures, S&P Dow Jones Indices, LLC compiles, maintains and calculates the index, which is designed to measure the performance of securities of small-capitalization U.S. companies in the industrials sector, as defined by the Global Industry Classification Standard.
PSCI (Invesco S&P SmallCap Industrials ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $176.0M, a beta of 1.37 versus the broader market, a 52-week range of 133.58-186.91, average daily share volume of 4K, a public-listing history dating back to 2010. These structural characteristics shape how PSCI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.37 indicates PSCI has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. PSCI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on PSCI?
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 PSCI snapshot
As of June 30, 2026, spot at $185.70, ATM IV 19.10%, IV rank 0.65%, expected move 5.48%. The collar on PSCI 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 17-day expiry.
Why this collar structure on PSCI specifically: IV regime affects collar pricing on both sides; compressed PSCI IV at 19.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.48% (roughly $10.17 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PSCI expiries trade a higher absolute premium for lower per-day decay. Position sizing on PSCI should anchor to the underlying notional of $185.70 per share and to the trader's directional view on PSCI etf.
PSCI collar setup
The PSCI 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 PSCI near $185.70, the first option leg uses a $192.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PSCI chain at a 17-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 PSCI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $185.70 | long |
| Sell 1 | Call | $192.00 | $0.84 |
| Buy 1 | Put | $176.00 | $0.61 |
PSCI collar risk and reward
- Net Premium / Debit
- -$18,547.00
- Max Profit (per contract)
- $653.00
- Max Loss (per contract)
- -$947.00
- Breakeven(s)
- $185.47
- Risk / Reward Ratio
- 0.690
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.
PSCI collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on PSCI. 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% | -$947.00 |
| $41.07 | -77.9% | -$947.00 |
| $82.13 | -55.8% | -$947.00 |
| $123.18 | -33.7% | -$947.00 |
| $164.24 | -11.6% | -$947.00 |
| $205.30 | +10.6% | +$653.00 |
| $246.36 | +32.7% | +$653.00 |
| $287.42 | +54.8% | +$653.00 |
| $328.48 | +76.9% | +$653.00 |
| $369.53 | +99.0% | +$653.00 |
When traders use collar on PSCI
Collars on PSCI hedge an existing long PSCI 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.
PSCI thesis for this collar
The market-implied 1-standard-deviation range for PSCI extends from approximately $175.53 on the downside to $195.87 on the upside. A PSCI collar hedges an existing long PSCI 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 PSCI IV rank near 0.65% 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 PSCI at 19.10%. As a Financial Services name, PSCI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PSCI-specific events.
PSCI 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. PSCI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PSCI alongside the broader basket even when PSCI-specific fundamentals are unchanged. Always rebuild the position from current PSCI chain quotes before placing a trade.
Frequently asked questions
- What is a collar on PSCI?
- A collar on PSCI is the collar strategy applied to PSCI (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 PSCI etf trading near $185.70, the strikes shown on this page are snapped to the nearest listed PSCI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PSCI 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 PSCI collar priced from the end-of-day chain at a 30-day expiry (ATM IV 19.10%), the computed maximum profit is $653.00 per contract and the computed maximum loss is -$947.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PSCI collar?
- The breakeven for the PSCI collar priced on this page is roughly $185.47 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 PSCI market-implied 1-standard-deviation expected move is approximately 5.48%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on PSCI?
- Collars on PSCI hedge an existing long PSCI 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 PSCI implied volatility affect this collar?
- PSCI ATM IV is at 19.10% with IV rank near 0.65%, 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.