PSCI Collar Strategy
PSCI (Invesco S&P SmallCap Industrials ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
The Invesco S&P SmallCap Industrials ETF (Fund) is based on the S&P SmallCap 600 Capped Industrials Index (Index). The Fund will normally invest at least 90% of its total assets in the securities that comprise the Index. The Index is designed to measure the overall performance of the securities of US industrial companies. These companies are principally engaged in the business of providing industrial products and services, including engineering, heavy machinery, construction, electrical equipment, aerospace and defense and general manufacturing.The Index is a subset of the S&P SmallCap 600 Index, which is a float-adjusted, market-capitalization-weighted index reflecting the US small-cap market. The Fund and the Index are rebalanced and reconstituted quarterly.
PSCI (Invesco S&P SmallCap Industrials ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $171.0M, a beta of 1.42 versus the broader market, a 52-week range of 123.83-178.02, average daily share volume of 5K, 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 1.42 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 May 15, 2026, spot at $165.50, ATM IV 23.20%, IV rank 33.91%, expected move 6.65%. 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 34-day expiry.
Why this collar structure on PSCI specifically: IV regime affects collar pricing on both sides; mid-range PSCI IV at 23.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.65% (roughly $11.01 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 PSCI expiries trade a higher absolute premium for lower per-day decay. Position sizing on PSCI should anchor to the underlying notional of $165.50 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 $165.50, the first option leg uses a $175.00 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 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 PSCI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $165.50 | long |
| Sell 1 | Call | $175.00 | $1.23 |
| Buy 1 | Put | $157.46 | $1.95 |
PSCI collar risk and reward
- Net Premium / Debit
- -$16,622.00
- Max Profit (per contract)
- $878.00
- Max Loss (per contract)
- -$876.00
- Breakeven(s)
- $166.22
- Risk / Reward Ratio
- 1.002
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% | -$876.00 |
| $36.60 | -77.9% | -$876.00 |
| $73.19 | -55.8% | -$876.00 |
| $109.79 | -33.7% | -$876.00 |
| $146.38 | -11.6% | -$876.00 |
| $182.97 | +10.6% | +$878.00 |
| $219.56 | +32.7% | +$878.00 |
| $256.15 | +54.8% | +$878.00 |
| $292.74 | +76.9% | +$878.00 |
| $329.34 | +99.0% | +$878.00 |
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 $154.49 on the downside to $176.51 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 33.91% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on PSCI should anchor more to the directional view and the expected-move geometry. 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 $165.50, 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 23.20%), the computed maximum profit is $878.00 per contract and the computed maximum loss is -$876.00 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 $166.22 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 6.65%; 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 23.20% with IV rank near 33.91%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.