WTAI Collar Strategy
WTAI (WisdomTree Artificial Intelligence and Innovation Fund), in the Financial Services sector, (Asset Management industry), listed on CBOE.
The index is designed to provide exposure to equity securities of exchange-listed companies globally, including developed countries and emerging markets throughout the world, which are primarily involved in the investment theme of Artificial Intelligence and Innovation. To the extent the index concentrates in the securities of a particular industry or group of industries, the fund will concentrate its investments to approximately the same extent as the index. It is non-diversified.
WTAI (WisdomTree Artificial Intelligence and Innovation Fund) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $559.9M, a beta of 1.81 versus the broader market, a 52-week range of 21.67-41.495, average daily share volume of 118K, a public-listing history dating back to 2021. These structural characteristics shape how WTAI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.81 indicates WTAI has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. WTAI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on WTAI?
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 WTAI snapshot
As of May 15, 2026, spot at $40.55, ATM IV 31.90%, IV rank 3.91%, expected move 9.15%. The collar on WTAI 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 WTAI specifically: IV regime affects collar pricing on both sides; compressed WTAI IV at 31.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 9.15% (roughly $3.71 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 WTAI expiries trade a higher absolute premium for lower per-day decay. Position sizing on WTAI should anchor to the underlying notional of $40.55 per share and to the trader's directional view on WTAI etf.
WTAI collar setup
The WTAI 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 WTAI near $40.55, the first option leg uses a $43.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed WTAI 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 WTAI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $40.55 | long |
| Sell 1 | Call | $43.00 | $1.00 |
| Buy 1 | Put | $39.00 | $0.98 |
WTAI collar risk and reward
- Net Premium / Debit
- -$4,052.50
- Max Profit (per contract)
- $247.50
- Max Loss (per contract)
- -$152.50
- Breakeven(s)
- $40.53
- Risk / Reward Ratio
- 1.623
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.
WTAI collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on WTAI. 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% | -$152.50 |
| $8.97 | -77.9% | -$152.50 |
| $17.94 | -55.8% | -$152.50 |
| $26.90 | -33.7% | -$152.50 |
| $35.87 | -11.5% | -$152.50 |
| $44.83 | +10.6% | +$247.50 |
| $53.80 | +32.7% | +$247.50 |
| $62.76 | +54.8% | +$247.50 |
| $71.73 | +76.9% | +$247.50 |
| $80.69 | +99.0% | +$247.50 |
When traders use collar on WTAI
Collars on WTAI hedge an existing long WTAI 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.
WTAI thesis for this collar
The market-implied 1-standard-deviation range for WTAI extends from approximately $36.84 on the downside to $44.26 on the upside. A WTAI collar hedges an existing long WTAI 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 WTAI IV rank near 3.91% 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 WTAI at 31.90%. As a Financial Services name, WTAI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to WTAI-specific events.
WTAI 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. WTAI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move WTAI alongside the broader basket even when WTAI-specific fundamentals are unchanged. Always rebuild the position from current WTAI chain quotes before placing a trade.
Frequently asked questions
- What is a collar on WTAI?
- A collar on WTAI is the collar strategy applied to WTAI (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 WTAI etf trading near $40.55, the strikes shown on this page are snapped to the nearest listed WTAI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are WTAI 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 WTAI collar priced from the end-of-day chain at a 30-day expiry (ATM IV 31.90%), the computed maximum profit is $247.50 per contract and the computed maximum loss is -$152.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a WTAI collar?
- The breakeven for the WTAI collar priced on this page is roughly $40.53 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 WTAI market-implied 1-standard-deviation expected move is approximately 9.15%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on WTAI?
- Collars on WTAI hedge an existing long WTAI 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 WTAI implied volatility affect this collar?
- WTAI ATM IV is at 31.90% with IV rank near 3.91%, 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.