ACRE Collar Strategy
ACRE (Ares Commercial Real Estate Corporation), in the Real Estate sector, (REIT - Mortgage industry), listed on NYSE.
Ares Commercial Real Estate Corporation, a specialty finance company, originates and invests in commercial real estate (CRE) loans and related investments in the United States. The company provides a range of financing solutions for the owners, operators, and sponsors of CRE properties. It originates senior mortgage loans, subordinate debt products, mezzanine loans, real estate preferred equity investments, and other CRE investments, including commercial mortgage backed securities. The company has elected and qualified to be taxed as a real estate investment trust for the United States federal income tax purposes under the Internal Revenue Code of 1986. Ares Commercial Real Estate Management LLC operates as the manager of the company. The company was incorporated in 2011 and is based in New York, New York.
ACRE (Ares Commercial Real Estate Corporation) trades in the Real Estate sector, specifically REIT - Mortgage, with a market capitalization of approximately $264.1M, a beta of 1.23 versus the broader market, a 52-week range of 4.05-5.89, average daily share volume of 422K, a public-listing history dating back to 2012, approximately 1K full-time employees. These structural characteristics shape how ACRE stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.23 places ACRE roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. ACRE pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on ACRE?
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 ACRE snapshot
As of May 15, 2026, spot at $4.61, ATM IV 22.90%, IV rank 13.65%, expected move 6.57%. The collar on ACRE 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 ACRE specifically: IV regime affects collar pricing on both sides; compressed ACRE IV at 22.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.57% (roughly $0.30 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 ACRE expiries trade a higher absolute premium for lower per-day decay. Position sizing on ACRE should anchor to the underlying notional of $4.61 per share and to the trader's directional view on ACRE stock.
ACRE collar setup
The ACRE 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 ACRE near $4.61, the first option leg uses a $4.84 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ACRE 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 ACRE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $4.61 | long |
| Sell 1 | Call | $4.84 | N/A |
| Buy 1 | Put | $4.38 | N/A |
ACRE 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.
ACRE collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on ACRE. 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 ACRE
Collars on ACRE hedge an existing long ACRE 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.
ACRE thesis for this collar
The market-implied 1-standard-deviation range for ACRE extends from approximately $4.31 on the downside to $4.91 on the upside. A ACRE collar hedges an existing long ACRE 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 ACRE IV rank near 13.65% 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 ACRE at 22.90%. As a Real Estate name, ACRE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ACRE-specific events.
ACRE 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. ACRE positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ACRE alongside the broader basket even when ACRE-specific fundamentals are unchanged. Always rebuild the position from current ACRE chain quotes before placing a trade.
Frequently asked questions
- What is a collar on ACRE?
- A collar on ACRE is the collar strategy applied to ACRE (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 ACRE stock trading near $4.61, the strikes shown on this page are snapped to the nearest listed ACRE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ACRE 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 ACRE collar priced from the end-of-day chain at a 30-day expiry (ATM IV 22.90%), 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 ACRE collar?
- The breakeven for the ACRE 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 ACRE market-implied 1-standard-deviation expected move is approximately 6.57%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on ACRE?
- Collars on ACRE hedge an existing long ACRE 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 ACRE implied volatility affect this collar?
- ACRE ATM IV is at 22.90% with IV rank near 13.65%, 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.