How are XMAG 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 XMAG collar priced from the end-of-day chain at a 30-day expiry (ATM IV 15.90%), the computed maximum profit is $111.00 per contract and the computed maximum loss is -$89.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a XMAG collar?

The breakeven for the XMAG collar priced on this page is roughly $25.89 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 XMAG market-implied 1-standard-deviation expected move is approximately 4.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current XMAG implied volatility affect this collar?

XMAG ATM IV is at 15.90% with IV rank near 1.20%, 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.

XMAG Collar Strategy

XMAG (Large Cap Ex-Mag 7 ETF), in the Financial Services sector, (Asset Management - Global industry), listed on NASDAQ.

The Defiance Large Cap ex-Magnificent Seven ETF endeavors to replicate the investment outcomes of the BITA US 500 ex-Magnificent 7 Index, exclusive of any fees and expenditures.

XMAG (Large Cap Ex-Mag 7 ETF) trades in the Financial Services sector, specifically Asset Management - Global, with a market capitalization of approximately $50.3M, a beta of 0.83 versus the broader market, a 52-week range of 20.862-25.95, average daily share volume of 55K, a public-listing history dating back to 2024. These structural characteristics shape how XMAG etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.83 places XMAG roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. XMAG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on XMAG?

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 XMAG snapshot

As of June 29, 2026, spot at $25.86, ATM IV 15.90%, IV rank 1.20%, expected move 4.56%. The collar on XMAG 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 18-day expiry.

Why this collar structure on XMAG specifically: IV regime affects collar pricing on both sides; compressed XMAG IV at 15.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 4.56% (roughly $1.18 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated XMAG expiries trade a higher absolute premium for lower per-day decay. Position sizing on XMAG should anchor to the underlying notional of $25.86 per share and to the trader's directional view on XMAG etf.

XMAG collar setup

The XMAG 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 XMAG near $25.86, the first option leg uses a $27.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed XMAG chain at a 18-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 XMAG shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$25.86	long
Sell 1	Call	$27.00	$0.30
Buy 1	Put	$25.00	$0.33

XMAG collar risk and reward

Net Premium / Debit: -$2,589.00
Max Profit (per contract): $111.00
Max Loss (per contract): -$89.00
Breakeven(s): $25.89
Risk / Reward Ratio: 1.247

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.

XMAG collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on XMAG. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$89.00
$5.73	-77.9%	-$89.00
$11.44	-55.7%	-$89.00
$17.16	-33.6%	-$89.00
$22.88	-11.5%	-$89.00
$28.59	+10.6%	+$111.00
$34.31	+32.7%	+$111.00
$40.03	+54.8%	+$111.00
$45.74	+76.9%	+$111.00
$51.46	+99.0%	+$111.00

When traders use collar on XMAG

Collars on XMAG hedge an existing long XMAG 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.

XMAG thesis for this collar

The market-implied 1-standard-deviation range for XMAG extends from approximately $24.68 on the downside to $27.04 on the upside. A XMAG collar hedges an existing long XMAG 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 XMAG IV rank near 1.20% 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 XMAG at 15.90%. As a Financial Services name, XMAG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to XMAG-specific events.

XMAG 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. XMAG positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move XMAG alongside the broader basket even when XMAG-specific fundamentals are unchanged. Always rebuild the position from current XMAG chain quotes before placing a trade.

Frequently asked questions

What is a collar on XMAG?: A collar on XMAG is the collar strategy applied to XMAG (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 XMAG etf trading near $25.86, the strikes shown on this page are snapped to the nearest listed XMAG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are XMAG 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 XMAG collar priced from the end-of-day chain at a 30-day expiry (ATM IV 15.90%), the computed maximum profit is $111.00 per contract and the computed maximum loss is -$89.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a XMAG collar?: The breakeven for the XMAG collar priced on this page is roughly $25.89 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 XMAG market-implied 1-standard-deviation expected move is approximately 4.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on XMAG?: Collars on XMAG hedge an existing long XMAG 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 XMAG implied volatility affect this collar?: XMAG ATM IV is at 15.90% with IV rank near 1.20%, 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.