How are ARWR 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 ARWR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 63.40%), the computed maximum profit is $490.50 per contract and the computed maximum loss is -$259.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a ARWR collar?

The breakeven for the ARWR collar priced on this page is roughly $75.10 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 ARWR market-implied 1-standard-deviation expected move is approximately 18.18%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current ARWR implied volatility affect this collar?

ARWR ATM IV is at 63.40% with IV rank near 32.00%, 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.

ARWR Collar Strategy

ARWR (Arrowhead Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.

Arrowhead Pharmaceuticals, Inc. develops medicines for the treatment of intractable diseases in the United States. The company's products in pipeline includes ARO-AAT, a RNA interference (RNAi) therapeutic candidate that is in Phase II clinical trial for the treatment of liver diseases associated with alpha-1 antitrypsin deficiency; ARO-APOC3, which is in phase 2b and one phase 3 clinical trial to treat hypertriglyceridemia; ARO-ANG3 that is in Phase 2b clinical trial to reduce production of angiopoietin-like protein 3; ARO-HSD, which is in Phase 1/2a clinical trial to treat liver diseases; ARO-ENaC, which is in a Phase 1/2a clinical trial to reduce production of the epithelial sodium channel alpha subunit in the airways of the lung; ARO-C3 for the treatment of complement-mediated disease that is in Phase 1/2a clinical trial; ARO-Lung2 for the treatment of chronic obstructive pulmonary disorder; ARO-DUX4 for the treatment of facioscapulohumeral muscular dystrophy; ARO-XDH to treat uncontrolled gout; ARO-COV for the treatment of COVID-19 and other pulmonary-borne pathogens; and ARO-HIF2, which is in phase 1b clinical trial to treat clear cell renal cell carcinoma. It is also involved in the development of JNJ-3989, a subcutaneously administered RNAi therapeutic candidate to treat chronic hepatitis B virus infection; Olpasiran to reduce the production of apolipoprotein A; and ARO-AMG1 for treating genetically validated cardiovascular targets. Arrowhead Pharmaceuticals, Inc. has a license and research collaboration agreement with Janssen Pharmaceuticals, Inc. to develop ARO-JNJ1, ARO-JNJ2, and ARO-JNJ3 RNAi therapeutics for liver-expressed targets; and license and research collaboration agreement with Takeda Pharmaceuticals U.S.A., Inc. to develop RNAi therapeutic candidate as a treatment for liver disease. Arrowhead Pharmaceuticals, Inc. was incorporated in 1989 and is headquartered in Pasadena, California.

ARWR (Arrowhead Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $10.97B, a beta of 1.29 versus the broader market, a 52-week range of 14.3-80.67, average daily share volume of 2.1M, a public-listing history dating back to 1993, approximately 609 full-time employees. These structural characteristics shape how ARWR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.29 places ARWR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a collar on ARWR?

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 ARWR snapshot

As of May 15, 2026, spot at $76.67, ATM IV 63.40%, IV rank 32.00%, expected move 18.18%. The collar on ARWR 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 ARWR specifically: IV regime affects collar pricing on both sides; mid-range ARWR IV at 63.40% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 18.18% (roughly $13.94 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 ARWR expiries trade a higher absolute premium for lower per-day decay. Position sizing on ARWR should anchor to the underlying notional of $76.67 per share and to the trader's directional view on ARWR stock.

ARWR collar setup

The ARWR 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 ARWR near $76.67, the first option leg uses a $80.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ARWR 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 ARWR shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$76.67	long
Sell 1	Call	$80.00	$4.95
Buy 1	Put	$72.50	$3.38

ARWR collar risk and reward

Net Premium / Debit: -$7,509.50
Max Profit (per contract): $490.50
Max Loss (per contract): -$259.50
Breakeven(s): $75.10
Risk / Reward Ratio: 1.890

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.

ARWR collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on ARWR. 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%	-$259.50
$16.96	-77.9%	-$259.50
$33.91	-55.8%	-$259.50
$50.86	-33.7%	-$259.50
$67.81	-11.6%	-$259.50
$84.77	+10.6%	+$490.50
$101.72	+32.7%	+$490.50
$118.67	+54.8%	+$490.50
$135.62	+76.9%	+$490.50
$152.57	+99.0%	+$490.50

When traders use collar on ARWR

Collars on ARWR hedge an existing long ARWR 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.

ARWR thesis for this collar

The market-implied 1-standard-deviation range for ARWR extends from approximately $62.73 on the downside to $90.61 on the upside. A ARWR collar hedges an existing long ARWR 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 ARWR IV rank near 32.00% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on ARWR should anchor more to the directional view and the expected-move geometry. As a Healthcare name, ARWR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ARWR-specific events.

ARWR 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. ARWR positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ARWR alongside the broader basket even when ARWR-specific fundamentals are unchanged. Always rebuild the position from current ARWR chain quotes before placing a trade.

Frequently asked questions

What is a collar on ARWR?: A collar on ARWR is the collar strategy applied to ARWR (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 ARWR stock trading near $76.67, the strikes shown on this page are snapped to the nearest listed ARWR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ARWR 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 ARWR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 63.40%), the computed maximum profit is $490.50 per contract and the computed maximum loss is -$259.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a ARWR collar?: The breakeven for the ARWR collar priced on this page is roughly $75.10 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 ARWR market-implied 1-standard-deviation expected move is approximately 18.18%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on ARWR?: Collars on ARWR hedge an existing long ARWR 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 ARWR implied volatility affect this collar?: ARWR ATM IV is at 63.40% with IV rank near 32.00%, 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.