ACGL Collar Strategy
ACGL (Arch Capital Group Ltd.), in the Financial Services sector, (Insurance - Diversified industry), listed on NASDAQ.
Arch Capital Group Ltd., together with its subsidiaries, provides insurance, reinsurance, and mortgage insurance products worldwide. The company's Insurance segment offers primary and excess casualty coverages; loss sensitive primary casualty insurance programs; collateral protection, debt cancellation, and service contract reimbursement products; directors' and officers' liability, errors and omissions liability, employment practices and fiduciary liability, crime, professional indemnity, and other financial related coverages; medical professional and general liability insurance coverages; and workers' compensation and umbrella liability, as well as commercial automobile and inland marine products. It also provides property, energy, marine, and aviation insurance; travel insurance; accident, disability, and medical plan insurance coverages; captive insurance programs; employer's liability; and contract and commercial surety coverages. This segment markets its products through a group of licensed independent retail and wholesale brokers. Its Reinsurance segment provides casualty reinsurance for third party liability and workers' compensation exposures; marine and aviation; surety, accident and health, workers' compensation catastrophe, agriculture, trade credit, and political risk products; reinsurance protection for catastrophic losses, and personal lines and commercial property exposures; life reinsurance; casualty clash; and risk management solutions. This segment markets its reinsurance products through brokers.
ACGL (Arch Capital Group Ltd.) trades in the Financial Services sector, specifically Insurance - Diversified, with a market capitalization of approximately $32.61B, a trailing P/E of 6.89, a beta of 0.33 versus the broader market, a 52-week range of 82.45-103.39, average daily share volume of 2.0M, a public-listing history dating back to 1995, approximately 7K full-time employees. These structural characteristics shape how ACGL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.33 indicates ACGL has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. The trailing P/E of 6.89 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. ACGL pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on ACGL?
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 ACGL snapshot
As of May 15, 2026, spot at $94.09, ATM IV 22.50%, IV rank 34.74%, expected move 6.45%. The collar on ACGL 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 ACGL specifically: IV regime affects collar pricing on both sides; mid-range ACGL IV at 22.50% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.45% (roughly $6.07 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 ACGL expiries trade a higher absolute premium for lower per-day decay. Position sizing on ACGL should anchor to the underlying notional of $94.09 per share and to the trader's directional view on ACGL stock.
ACGL collar setup
The ACGL 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 ACGL near $94.09, the first option leg uses a $98.79 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ACGL 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 ACGL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $94.09 | long |
| Sell 1 | Call | $98.79 | N/A |
| Buy 1 | Put | $89.39 | N/A |
ACGL collar risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
ACGL collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on ACGL. 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.
When traders use collar on ACGL
Collars on ACGL hedge an existing long ACGL stock 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.
ACGL thesis for this collar
The market-implied 1-standard-deviation range for ACGL extends from approximately $88.02 on the downside to $100.16 on the upside. A ACGL collar hedges an existing long ACGL 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 ACGL IV rank near 34.74% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on ACGL should anchor more to the directional view and the expected-move geometry. As a Financial Services name, ACGL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ACGL-specific events.
ACGL 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. ACGL positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ACGL alongside the broader basket even when ACGL-specific fundamentals are unchanged. Always rebuild the position from current ACGL chain quotes before placing a trade.
Frequently asked questions
- What is a collar on ACGL?
- A collar on ACGL is the collar strategy applied to ACGL (stock). 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 ACGL stock trading near $94.09, the strikes shown on this page are snapped to the nearest listed ACGL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ACGL 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 ACGL collar priced from the end-of-day chain at a 30-day expiry (ATM IV 22.50%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ACGL collar?
- The breakeven for the ACGL collar priced on this page is no defined breakeven on the modeled curve 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 ACGL market-implied 1-standard-deviation expected move is approximately 6.45%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on ACGL?
- Collars on ACGL hedge an existing long ACGL stock 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 ACGL implied volatility affect this collar?
- ACGL ATM IV is at 22.50% with IV rank near 34.74%, 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.