XDTE Collar Strategy
XDTE (Roundhill Investments - S&P 500 0DTE Covered Call Strategy ETF), in the Financial Services sector, (Asset Management industry), listed on CBOE.
The Roundhill S&P 500 0DTE Covered Call Strategy ETF (“XDTE”) is the first ETF to utilize zero days to expiry (“0DTE”)*** options on the S&P 500. XDTE seeks to provide overnight exposure to the S&P 500 and generate income each morning by selling out-of-the-money 0DTE calls on the Index. XDTE is an actively-managed ETF.
XDTE (Roundhill Investments - S&P 500 0DTE Covered Call Strategy ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $293.2M, a beta of 0.93 versus the broader market, a 52-week range of 35.87-44.81, average daily share volume of 222K, a public-listing history dating back to 2024. These structural characteristics shape how XDTE etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.93 places XDTE roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. XDTE pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on XDTE?
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 XDTE snapshot
As of May 15, 2026, spot at $39.59, ATM IV 18.70%, IV rank 3.28%, expected move 5.36%. The collar on XDTE 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 63-day expiry.
Why this collar structure on XDTE specifically: IV regime affects collar pricing on both sides; compressed XDTE IV at 18.70% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.36% (roughly $2.12 on the underlying). The 63-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated XDTE expiries trade a higher absolute premium for lower per-day decay. Position sizing on XDTE should anchor to the underlying notional of $39.59 per share and to the trader's directional view on XDTE etf.
XDTE collar setup
The XDTE 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 XDTE near $39.59, the first option leg uses a $42.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed XDTE chain at a 63-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 XDTE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $39.59 | long |
| Sell 1 | Call | $42.00 | $0.46 |
| Buy 1 | Put | $38.00 | $1.10 |
XDTE collar risk and reward
- Net Premium / Debit
- -$4,023.00
- Max Profit (per contract)
- $177.00
- Max Loss (per contract)
- -$223.00
- Breakeven(s)
- $40.23
- Risk / Reward Ratio
- 0.794
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.
XDTE collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on XDTE. 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% | -$223.00 |
| $8.76 | -77.9% | -$223.00 |
| $17.51 | -55.8% | -$223.00 |
| $26.27 | -33.7% | -$223.00 |
| $35.02 | -11.5% | -$223.00 |
| $43.77 | +10.6% | +$177.00 |
| $52.52 | +32.7% | +$177.00 |
| $61.28 | +54.8% | +$177.00 |
| $70.03 | +76.9% | +$177.00 |
| $78.78 | +99.0% | +$177.00 |
When traders use collar on XDTE
Collars on XDTE hedge an existing long XDTE 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.
XDTE thesis for this collar
The market-implied 1-standard-deviation range for XDTE extends from approximately $37.47 on the downside to $41.71 on the upside. A XDTE collar hedges an existing long XDTE 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 XDTE IV rank near 3.28% 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 XDTE at 18.70%. As a Financial Services name, XDTE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to XDTE-specific events.
XDTE 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. XDTE positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move XDTE alongside the broader basket even when XDTE-specific fundamentals are unchanged. Always rebuild the position from current XDTE chain quotes before placing a trade.
Frequently asked questions
- What is a collar on XDTE?
- A collar on XDTE is the collar strategy applied to XDTE (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 XDTE etf trading near $39.59, the strikes shown on this page are snapped to the nearest listed XDTE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are XDTE 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 XDTE collar priced from the end-of-day chain at a 30-day expiry (ATM IV 18.70%), the computed maximum profit is $177.00 per contract and the computed maximum loss is -$223.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a XDTE collar?
- The breakeven for the XDTE collar priced on this page is roughly $40.23 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 XDTE market-implied 1-standard-deviation expected move is approximately 5.36%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on XDTE?
- Collars on XDTE hedge an existing long XDTE 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 XDTE implied volatility affect this collar?
- XDTE ATM IV is at 18.70% with IV rank near 3.28%, 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.