UYG Collar Strategy
UYG (ProShares - Ultra Financials), in the Financial Services sector, (Asset Management - Leveraged industry), listed on AMEX.
The ProShares Ultra Financials fund aims to achieve daily investment returns that are double the daily fluctuations of the S&P Financial Select SectorSM Index. This goal is pursued prior to the deduction of any charges or operating costs.
UYG (ProShares - Ultra Financials) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $695.8M, a beta of 1.65 versus the broader market, a 52-week range of 68.44-104.32, average daily share volume of 14K, a public-listing history dating back to 2007. These structural characteristics shape how UYG etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.65 indicates UYG has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. UYG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on UYG?
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 UYG snapshot
As of June 30, 2026, spot at $85.48, ATM IV 34.10%, IV rank 37.53%, expected move 9.78%. The collar on UYG 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 UYG specifically: IV regime affects collar pricing on both sides; mid-range UYG IV at 34.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 9.78% (roughly $8.36 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 UYG expiries trade a higher absolute premium for lower per-day decay. Position sizing on UYG should anchor to the underlying notional of $85.48 per share and to the trader's directional view on UYG etf.
UYG collar setup
The UYG 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 UYG near $85.48, the first option leg uses a $90.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UYG 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 UYG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $85.48 | long |
| Sell 1 | Call | $90.00 | $1.00 |
| Buy 1 | Put | $81.00 | $0.73 |
UYG collar risk and reward
- Net Premium / Debit
- -$8,520.50
- Max Profit (per contract)
- $479.50
- Max Loss (per contract)
- -$420.50
- Breakeven(s)
- $85.21
- Risk / Reward Ratio
- 1.140
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.
UYG collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on UYG. 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% | -$420.50 |
| $18.91 | -77.9% | -$420.50 |
| $37.81 | -55.8% | -$420.50 |
| $56.71 | -33.7% | -$420.50 |
| $75.61 | -11.6% | -$420.50 |
| $94.50 | +10.6% | +$479.50 |
| $113.40 | +32.7% | +$479.50 |
| $132.30 | +54.8% | +$479.50 |
| $151.20 | +76.9% | +$479.50 |
| $170.10 | +99.0% | +$479.50 |
When traders use collar on UYG
Collars on UYG hedge an existing long UYG 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.
UYG thesis for this collar
The market-implied 1-standard-deviation range for UYG extends from approximately $77.12 on the downside to $93.84 on the upside. A UYG collar hedges an existing long UYG 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 UYG IV rank near 37.53% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on UYG should anchor more to the directional view and the expected-move geometry. As a Financial Services name, UYG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UYG-specific events.
UYG 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. UYG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UYG alongside the broader basket even when UYG-specific fundamentals are unchanged. Always rebuild the position from current UYG chain quotes before placing a trade.
Frequently asked questions
- What is a collar on UYG?
- A collar on UYG is the collar strategy applied to UYG (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 UYG etf trading near $85.48, the strikes shown on this page are snapped to the nearest listed UYG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UYG 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 UYG collar priced from the end-of-day chain at a 30-day expiry (ATM IV 34.10%), the computed maximum profit is $479.50 per contract and the computed maximum loss is -$420.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UYG collar?
- The breakeven for the UYG collar priced on this page is roughly $85.21 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 UYG market-implied 1-standard-deviation expected move is approximately 9.78%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on UYG?
- Collars on UYG hedge an existing long UYG 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 UYG implied volatility affect this collar?
- UYG ATM IV is at 34.10% with IV rank near 37.53%, 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.