How are BNS 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 BNS collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 20.70%), the computed maximum profit is $347.50 per contract and the computed maximum loss is -$402.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a BNS collar?

The breakeven for the BNS collar priced on this page is roughly $91.52 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The BNS market-implied 1-standard-deviation expected move in the same options snapshot is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current BNS implied volatility affect this collar?

BNS ATM IV is at 20.70% with IV rank near 3.24%, 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.

BNS Collar Strategy

BNS (The Bank of Nova Scotia), in the Financial Services sector, (Banks - Diversified industry), listed on NYSE.

The Bank of Nova Scotia provides various banking products and services in Canada, the United States, Mexico, Peru, Chile, Colombia, the Caribbean and Central America, and internationally. It operates through Canadian Banking, International Banking, Global Wealth Management, and Global Banking and Markets segments. The company offers financial advice and solutions, and banking products, including debit and credit cards, chequing and saving accounts, investments, mortgages, loans, and insurance to individuals; and retail automotive financing solutions. It also provides business banking solutions comprising lending, deposit, cash management, and trade finance solutions to small, medium, and large businesses. In addition, it provides wealth management advice and solutions, including online brokerage, mobile investment, full-service brokerage, trust, private banking, and private investment counsel services; and retail mutual funds, exchange traded funds, liquid alternatives, and institutional funds. The company was founded in 1832 and is headquartered in Toronto, Canada.

BNS (The Bank of Nova Scotia) trades in the Financial Services sector, specifically Banks - Diversified, with a market capitalization of approximately $111.60B, a trailing P/E of 16.36, a beta of 1.21 versus the broader market, a 52-week range of 56.54-91.55, average daily share volume of 2.5M, a public-listing history dating back to 2002, approximately 80K full-time employees. These structural characteristics shape how BNS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.21 places BNS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. BNS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on BNS?

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.

BNS snapshot

As of August 14, 2026, spot at $91.25, ATM IV 20.70%, IV rank 3.24%, expected move 5.93%. The collar on BNS below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.

Why this collar structure on BNS specifically: IV regime affects collar pricing on both sides; compressed BNS IV at 20.70% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.93% (roughly $5.42 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated BNS expiries trade a higher absolute premium for lower per-day decay. Position sizing on BNS should anchor to the underlying notional of $91.25 per share and to the trader's directional view on BNS stock.

BNS collar setup

The BNS collar below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With BNS at $91.25 on that close, the first option leg uses a $95.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed BNS chain at a 35-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 BNS shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$91.25	long
Sell 1	Call	$95.00	$0.83
Buy 1	Put	$87.50	$1.10

BNS collar risk and reward

Net Premium / Debit: -$9,152.50
Max Profit (per contract): $347.50
Max Loss (per contract): -$402.50
Breakeven(s): $91.52
Risk / Reward Ratio: 0.863

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.

BNS collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on BNS. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$402.50
$20.18	-77.9%	-$402.50
$40.36	-55.8%	-$402.50
$60.53	-33.7%	-$402.50
$80.71	-11.6%	-$402.50
$100.88	+10.6%	+$347.50
$121.06	+32.7%	+$347.50
$141.23	+54.8%	+$347.50
$161.41	+76.9%	+$347.50
$181.58	+99.0%	+$347.50

When traders use collar on BNS

Collars on BNS hedge an existing long BNS 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.

BNS thesis for this collar

The market-implied 1-standard-deviation range for BNS extends from approximately $85.83 on the downside to $96.67 on the upside. A BNS collar hedges an existing long BNS 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 BNS IV rank near 3.24% 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 BNS at 20.70%. As a Financial Services name, BNS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to BNS-specific events.

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

Frequently asked questions

What is a collar on BNS?: A collar on BNS is the collar strategy applied to BNS (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 BNS stock at $91.25 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed BNS chain strike and the premiums come straight from that session's bid/ask midpoint.
How are BNS 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 BNS collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 20.70%), the computed maximum profit is $347.50 per contract and the computed maximum loss is -$402.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a BNS collar?: The breakeven for the BNS collar priced on this page is roughly $91.52 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The BNS market-implied 1-standard-deviation expected move in the same options snapshot is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on BNS?: Collars on BNS hedge an existing long BNS 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 BNS implied volatility affect this collar?: BNS ATM IV is at 20.70% with IV rank near 3.24%, 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.