PST Collar Strategy
PST (ProShares - UltraShort 7-10 Year Treasury), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.
ProShares UltraShort 7-10 Year Treasury seeks daily investment results, before fees and expenses, that correspond to two times the inverse (-2x) of the daily performance of the ICE U.S. Treasury 7-10 Year Bond Index.
PST (ProShares - UltraShort 7-10 Year Treasury) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $11.4M, a beta of -2.35 versus the broader market, a 52-week range of 21.39-24.15, average daily share volume of 13K, a public-listing history dating back to 2008. These structural characteristics shape how PST etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -2.35 indicates PST has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. PST pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on PST?
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 PST snapshot
As of May 15, 2026, spot at $23.36, ATM IV 13.20%, IV rank 4.42%, expected move 3.78%. The collar on PST 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 PST specifically: IV regime affects collar pricing on both sides; compressed PST IV at 13.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 3.78% (roughly $0.88 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 PST expiries trade a higher absolute premium for lower per-day decay. Position sizing on PST should anchor to the underlying notional of $23.36 per share and to the trader's directional view on PST etf.
PST collar setup
The PST 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 PST near $23.36, the first option leg uses a $25.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PST 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 PST shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $23.36 | long |
| Sell 1 | Call | $25.00 | $0.08 |
| Buy 1 | Put | $22.00 | $0.03 |
PST collar risk and reward
- Net Premium / Debit
- -$2,331.50
- Max Profit (per contract)
- $168.50
- Max Loss (per contract)
- -$131.50
- Breakeven(s)
- $23.31
- Risk / Reward Ratio
- 1.281
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.
PST collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on PST. 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% | -$131.50 |
| $5.17 | -77.9% | -$131.50 |
| $10.34 | -55.7% | -$131.50 |
| $15.50 | -33.6% | -$131.50 |
| $20.67 | -11.5% | -$131.50 |
| $25.83 | +10.6% | +$168.50 |
| $30.99 | +32.7% | +$168.50 |
| $36.16 | +54.8% | +$168.50 |
| $41.32 | +76.9% | +$168.50 |
| $46.49 | +99.0% | +$168.50 |
When traders use collar on PST
Collars on PST hedge an existing long PST 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.
PST thesis for this collar
The market-implied 1-standard-deviation range for PST extends from approximately $22.48 on the downside to $24.24 on the upside. A PST collar hedges an existing long PST 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 PST IV rank near 4.42% 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 PST at 13.20%. As a Financial Services name, PST options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PST-specific events.
PST 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. PST positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PST alongside the broader basket even when PST-specific fundamentals are unchanged. Always rebuild the position from current PST chain quotes before placing a trade.
Frequently asked questions
- What is a collar on PST?
- A collar on PST is the collar strategy applied to PST (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 PST etf trading near $23.36, the strikes shown on this page are snapped to the nearest listed PST chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PST 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 PST collar priced from the end-of-day chain at a 30-day expiry (ATM IV 13.20%), the computed maximum profit is $168.50 per contract and the computed maximum loss is -$131.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PST collar?
- The breakeven for the PST collar priced on this page is roughly $23.31 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 PST market-implied 1-standard-deviation expected move is approximately 3.78%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on PST?
- Collars on PST hedge an existing long PST 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 PST implied volatility affect this collar?
- PST ATM IV is at 13.20% with IV rank near 4.42%, 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.