ARW Collar Strategy
ARW (Arrow Electronics, Inc.), in the Technology sector, (Technology Distributors industry), listed on NYSE.
Arrow Electronics, Inc. provides products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. The company operates in two segments, Global Components and Global Enterprise Computing Solutions. The Global Components segment markets and distributes semiconductor products and related services; passive, electro-mechanical, and interconnect products, including capacitors, resistors, potentiometers, power supplies, relays, switches, and connectors; and computing and memory products, as well as other products and services. The Global Enterprise Computing Solutions segment offers computing solutions, such as datacenter, cloud, security, and analytics solutions. This segment provides access to various services, including engineering and integration support, warehousing and logistics, marketing resources, and authorized hardware and software training. The company serves original equipment manufacturers, value-added resellers, managed service providers, contract manufacturers, and other commercial customers.
ARW (Arrow Electronics, Inc.) trades in the Technology sector, specifically Technology Distributors, with a market capitalization of approximately $10.83B, a trailing P/E of 14.96, a beta of 1.17 versus the broader market, a 52-week range of 101.79-212.44, average daily share volume of 614K, a public-listing history dating back to 1980, approximately 22K full-time employees. These structural characteristics shape how ARW stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.17 places ARW roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a collar on ARW?
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 ARW snapshot
As of May 15, 2026, spot at $209.16, ATM IV 37.50%, IV rank 57.32%, expected move 10.75%. The collar on ARW 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 ARW specifically: IV regime affects collar pricing on both sides; mid-range ARW IV at 37.50% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.75% (roughly $22.49 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 ARW expiries trade a higher absolute premium for lower per-day decay. Position sizing on ARW should anchor to the underlying notional of $209.16 per share and to the trader's directional view on ARW stock.
ARW collar setup
The ARW 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 ARW near $209.16, the first option leg uses a $220.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ARW 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 ARW shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $209.16 | long |
| Sell 1 | Call | $220.00 | $5.70 |
| Buy 1 | Put | $200.00 | $5.40 |
ARW collar risk and reward
- Net Premium / Debit
- -$20,886.00
- Max Profit (per contract)
- $1,114.00
- Max Loss (per contract)
- -$886.00
- Breakeven(s)
- $208.86
- Risk / Reward Ratio
- 1.257
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.
ARW collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on ARW. 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% | -$886.00 |
| $46.26 | -77.9% | -$886.00 |
| $92.50 | -55.8% | -$886.00 |
| $138.75 | -33.7% | -$886.00 |
| $184.99 | -11.6% | -$886.00 |
| $231.24 | +10.6% | +$1,114.00 |
| $277.48 | +32.7% | +$1,114.00 |
| $323.73 | +54.8% | +$1,114.00 |
| $369.97 | +76.9% | +$1,114.00 |
| $416.22 | +99.0% | +$1,114.00 |
When traders use collar on ARW
Collars on ARW hedge an existing long ARW 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.
ARW thesis for this collar
The market-implied 1-standard-deviation range for ARW extends from approximately $186.67 on the downside to $231.65 on the upside. A ARW collar hedges an existing long ARW 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 ARW IV rank near 57.32% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on ARW should anchor more to the directional view and the expected-move geometry. As a Technology name, ARW options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ARW-specific events.
ARW 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. ARW positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ARW alongside the broader basket even when ARW-specific fundamentals are unchanged. Always rebuild the position from current ARW chain quotes before placing a trade.
Frequently asked questions
- What is a collar on ARW?
- A collar on ARW is the collar strategy applied to ARW (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 ARW stock trading near $209.16, the strikes shown on this page are snapped to the nearest listed ARW chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ARW 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 ARW collar priced from the end-of-day chain at a 30-day expiry (ATM IV 37.50%), the computed maximum profit is $1,114.00 per contract and the computed maximum loss is -$886.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ARW collar?
- The breakeven for the ARW collar priced on this page is roughly $208.86 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 ARW market-implied 1-standard-deviation expected move is approximately 10.75%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on ARW?
- Collars on ARW hedge an existing long ARW 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 ARW implied volatility affect this collar?
- ARW ATM IV is at 37.50% with IV rank near 57.32%, 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.