AGCO Collar Strategy
AGCO (AGCO Corporation), in the Industrials sector, (Agricultural - Machinery industry), listed on NYSE.
AGCO Corporation manufactures and distributes agricultural equipment and related replacement parts worldwide. It offers horsepower tractors for row crop production, soil cultivation, planting, land leveling, seeding, and commercial hay operations; utility tractors for small- and medium-sized farms, as well as for dairy, livestock, orchards, and vineyards; and compact tractors for small farms, specialty agricultural industries, landscaping, equestrian, and residential uses. The company also provides grain storage bins and related drying and handling equipment systems; seed-processing systems; swine and poultry feed storage and delivery; ventilation and watering systems; and egg production systems and broiler production equipment. In addition, it offers round and rectangular balers, loader wagons, self-propelled windrowers, forage harvesters, disc mowers, spreaders, rakes, tedders, and mower conditioners for harvesting and packaging vegetative feeds used in the beef cattle, dairy, horse, and renewable fuel industries. Further, the company provides implements, including disc harrows leveling seed beds and mixing chemicals with the soils; heavy tillage to break up soil and mix crop residue into topsoil; field cultivators that prepare smooth seed bed and destroy weeds; drills for small grain seeding; planters and other planting equipment; and loaders. Additionally, it offers combines for harvesting grain crops, such as corn, wheat, soybeans, and rice; and application equipment, such as self-propelled, three- and four-wheeled vehicles, and related equipment for liquid and dry fertilizers and crop protection chemicals, and for after crops emerge from the ground, as well as produces diesel engines, gears, and generating sets.
AGCO (AGCO Corporation) trades in the Industrials sector, specifically Agricultural - Machinery, with a market capitalization of approximately $8.40B, a trailing P/E of 10.90, a beta of 1.12 versus the broader market, a 52-week range of 95.96-143.78, average daily share volume of 729K, a public-listing history dating back to 1992, approximately 24K full-time employees. These structural characteristics shape how AGCO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.12 places AGCO roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 10.90 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. AGCO pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on AGCO?
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 AGCO snapshot
As of May 15, 2026, spot at $113.68, ATM IV 37.40%, IV rank 38.53%, expected move 10.72%. The collar on AGCO 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 AGCO specifically: IV regime affects collar pricing on both sides; mid-range AGCO IV at 37.40% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.72% (roughly $12.19 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 AGCO expiries trade a higher absolute premium for lower per-day decay. Position sizing on AGCO should anchor to the underlying notional of $113.68 per share and to the trader's directional view on AGCO stock.
AGCO collar setup
The AGCO 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 AGCO near $113.68, the first option leg uses a $120.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AGCO 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 AGCO shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $113.68 | long |
| Sell 1 | Call | $120.00 | $2.88 |
| Buy 1 | Put | $110.00 | $3.55 |
AGCO collar risk and reward
- Net Premium / Debit
- -$11,435.50
- Max Profit (per contract)
- $564.50
- Max Loss (per contract)
- -$435.50
- Breakeven(s)
- $114.35
- Risk / Reward Ratio
- 1.296
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.
AGCO collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on AGCO. 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% | -$435.50 |
| $25.14 | -77.9% | -$435.50 |
| $50.28 | -55.8% | -$435.50 |
| $75.41 | -33.7% | -$435.50 |
| $100.55 | -11.6% | -$435.50 |
| $125.68 | +10.6% | +$564.50 |
| $150.82 | +32.7% | +$564.50 |
| $175.95 | +54.8% | +$564.50 |
| $201.08 | +76.9% | +$564.50 |
| $226.22 | +99.0% | +$564.50 |
When traders use collar on AGCO
Collars on AGCO hedge an existing long AGCO 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.
AGCO thesis for this collar
The market-implied 1-standard-deviation range for AGCO extends from approximately $101.49 on the downside to $125.87 on the upside. A AGCO collar hedges an existing long AGCO 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 AGCO IV rank near 38.53% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on AGCO should anchor more to the directional view and the expected-move geometry. As a Industrials name, AGCO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AGCO-specific events.
AGCO 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. AGCO positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AGCO alongside the broader basket even when AGCO-specific fundamentals are unchanged. Always rebuild the position from current AGCO chain quotes before placing a trade.
Frequently asked questions
- What is a collar on AGCO?
- A collar on AGCO is the collar strategy applied to AGCO (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 AGCO stock trading near $113.68, the strikes shown on this page are snapped to the nearest listed AGCO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are AGCO 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 AGCO collar priced from the end-of-day chain at a 30-day expiry (ATM IV 37.40%), the computed maximum profit is $564.50 per contract and the computed maximum loss is -$435.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AGCO collar?
- The breakeven for the AGCO collar priced on this page is roughly $114.35 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 AGCO market-implied 1-standard-deviation expected move is approximately 10.72%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on AGCO?
- Collars on AGCO hedge an existing long AGCO 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 AGCO implied volatility affect this collar?
- AGCO ATM IV is at 37.40% with IV rank near 38.53%, 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.