ARQT Collar Strategy
ARQT (Arcutis Biotherapeutics, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Arcutis Biotherapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing treatments for dermatological diseases. Its lead product candidate is ARQ-151, a topical roflumilast cream that has completed Phase III clinical trials for the treatment of plaque psoriasis and atopic dermatitis. The company is also developing ARQ-154, a topical foam formulation of roflumilast for the treatment of seborrheic dermatitis and scalp psoriasis; ARQ-252, a selective topical janus kinase type 1 inhibitor for hand eczema and vitiligo; and ARQ-255, a topical formulation of ARQ-252 designed to reach deeper into the skin in order to treat alopecia areata. The company was formerly known as Arcutis, Inc. and changed its name to Arcutis Biotherapeutics, Inc. in October 2019. Arcutis Biotherapeutics, Inc. was incorporated in 2016 and is headquartered in Westlake Village, California.
ARQT (Arcutis Biotherapeutics, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $2.71B, a beta of 1.59 versus the broader market, a 52-week range of 12.72-31.77, average daily share volume of 1.5M, a public-listing history dating back to 2020, approximately 342 full-time employees. These structural characteristics shape how ARQT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.59 indicates ARQT has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a collar on ARQT?
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 ARQT snapshot
As of May 15, 2026, spot at $21.48, ATM IV 53.60%, IV rank 18.78%, expected move 15.37%. The collar on ARQT 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 ARQT specifically: IV regime affects collar pricing on both sides; compressed ARQT IV at 53.60% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 15.37% (roughly $3.30 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 ARQT expiries trade a higher absolute premium for lower per-day decay. Position sizing on ARQT should anchor to the underlying notional of $21.48 per share and to the trader's directional view on ARQT stock.
ARQT collar setup
The ARQT 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 ARQT near $21.48, the first option leg uses a $22.55 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ARQT 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 ARQT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $21.48 | long |
| Sell 1 | Call | $22.55 | N/A |
| Buy 1 | Put | $20.41 | N/A |
ARQT 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.
ARQT collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on ARQT. 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 ARQT
Collars on ARQT hedge an existing long ARQT 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.
ARQT thesis for this collar
The market-implied 1-standard-deviation range for ARQT extends from approximately $18.18 on the downside to $24.78 on the upside. A ARQT collar hedges an existing long ARQT 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 ARQT IV rank near 18.78% 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 ARQT at 53.60%. As a Healthcare name, ARQT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ARQT-specific events.
ARQT 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. ARQT positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ARQT alongside the broader basket even when ARQT-specific fundamentals are unchanged. Always rebuild the position from current ARQT chain quotes before placing a trade.
Frequently asked questions
- What is a collar on ARQT?
- A collar on ARQT is the collar strategy applied to ARQT (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 ARQT stock trading near $21.48, the strikes shown on this page are snapped to the nearest listed ARQT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ARQT 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 ARQT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 53.60%), 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 ARQT collar?
- The breakeven for the ARQT 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 ARQT market-implied 1-standard-deviation expected move is approximately 15.37%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on ARQT?
- Collars on ARQT hedge an existing long ARQT 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 ARQT implied volatility affect this collar?
- ARQT ATM IV is at 53.60% with IV rank near 18.78%, 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.