RAAA Collar Strategy
RAAA (Reckoner Yield Enhanced AAA CLO ETF), in the Financial Services sector, (Asset Management - Bonds industry), listed on AMEX.
The RAAA fund employs a leverage strategy, utilizing reverse repurchase agreements to achieve up to 50% additional exposure to U.S. dollar-denominated Collateralized Loan Obligations (CLOs). Its primary objectives are generating income and preserving capital, which it pursues by concentrating investments in AAA-rated CLO tranches. These tranches represent the most senior and highest-quality segments within a CLO structure, supported by diverse pools of underlying loans, often including leveraged loans. All eligible CLOs must carry an AAA rating or be determined to be of equivalent credit quality by the investment adviser. However, the fund has the flexibility to allocate a maximum of 20% of its assets to CLOs rated AA or A. The investment selection process follows a rigorous bottom-up methodology, assessing factors such as the expertise of the CLO manager, the specifics of the deal structure, the quality of the underlying collateral, projected cash flows, and market trading frequency.
RAAA (Reckoner Yield Enhanced AAA CLO ETF) trades in the Financial Services sector, specifically Asset Management - Bonds, with a market capitalization of approximately $27.9M, a beta of 0.06 versus the broader market, a 52-week range of 24.781-25.225, average daily share volume of 4K, a public-listing history dating back to 2025. These structural characteristics shape how RAAA etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.06 indicates RAAA has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. RAAA pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on RAAA?
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.
RAAA snapshot
As of August 14, 2026, spot at $25.06, ATM IV 28.00%, expected move 8.03%. The collar on RAAA 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 7-day expiry.
Why this collar structure on RAAA specifically: IV rank is unavailable in the current snapshot, so regime-based timing for RAAA is inferred from ATM IV at 28.00% alone, with a market-implied 1-standard-deviation move of approximately 8.03% (roughly $2.01 on the underlying). The 7-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated RAAA expiries trade a higher absolute premium for lower per-day decay. Position sizing on RAAA should anchor to the underlying notional of $25.06 per share and to the trader's directional view on RAAA etf.
RAAA collar setup
The RAAA 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 RAAA at $25.06 on that close, the first option leg uses a $26.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RAAA chain at a 7-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 RAAA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $25.06 | long |
| Sell 1 | Call | $26.00 | $0.42 |
| Buy 1 | Put | $24.00 | $0.35 |
RAAA collar risk and reward
- Net Premium / Debit
- -$2,499.00
- Max Profit (per contract)
- $101.00
- Max Loss (per contract)
- -$99.00
- Breakeven(s)
- $24.99
- Risk / Reward Ratio
- 1.020
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.
RAAA collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on RAAA. 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% | -$99.00 |
| $5.55 | -77.9% | -$99.00 |
| $11.09 | -55.7% | -$99.00 |
| $16.63 | -33.6% | -$99.00 |
| $22.17 | -11.5% | -$99.00 |
| $27.71 | +10.6% | +$101.00 |
| $33.25 | +32.7% | +$101.00 |
| $38.79 | +54.8% | +$101.00 |
| $44.33 | +76.9% | +$101.00 |
| $49.87 | +99.0% | +$101.00 |
When traders use collar on RAAA
Collars on RAAA hedge an existing long RAAA 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.
RAAA thesis for this collar
The market-implied 1-standard-deviation range for RAAA extends from approximately $23.05 on the downside to $27.07 on the upside. A RAAA collar hedges an existing long RAAA 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. As a Financial Services name, RAAA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RAAA-specific events.
RAAA 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. RAAA positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RAAA alongside the broader basket even when RAAA-specific fundamentals are unchanged. Always rebuild the position from current RAAA chain quotes before placing a trade.
Frequently asked questions
- What is a collar on RAAA?
- A collar on RAAA is the collar strategy applied to RAAA (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 RAAA etf at $25.06 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed RAAA chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are RAAA 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 RAAA collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 28.00%), the computed maximum profit is $101.00 per contract and the computed maximum loss is -$99.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RAAA collar?
- The breakeven for the RAAA collar priced on this page is roughly $24.99 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 RAAA market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.03%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on RAAA?
- Collars on RAAA hedge an existing long RAAA 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 RAAA implied volatility affect this collar?
- Current RAAA ATM IV is 28.00%; IV rank context is unavailable in the current snapshot.