CABA Collar Strategy
CABA (Cabaletta Bio, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Cabaletta Bio, Inc., a clinical-stage biotechnology company, focuses on the discovery and development of engineered T cell therapies for patients with B cell-mediated autoimmune diseases. Its proprietary technology utilizes chimeric autoantibody receptor (CAAR) T cells that are designed to selectively bind and eliminate B cells, which produce disease-causing autoantibodies or pathogenic B cells. The company's lead product candidate is DSG3-CAART, which is in Phase I clinical trial for the treatment of mucosal pemphigus vulgaris, an autoimmune blistering skin disease, and Hemophilia A with Factor VIII alloantibodies. Its product candidate pipeline also includes MuSK-CAART, a preclinical stage product to treat a subset of patients with myasthenia gravis; FVIII-CAART, a discovery stage product to treat a subset of patients with Hemophilia A; and DSG3/1-CAART, a discovery stage product for the treatment of mucocutaneous pemphigus vulgaris. It has a collaboration with the University of Pennsylvania; and research agreement with The Regents of the University of California. The company was formerly known as Tycho Therapeutics, Inc. and changed its name to Cabaletta Bio, Inc. in August 2018.
CABA (Cabaletta Bio, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $345.6M, a beta of 3.17 versus the broader market, a 52-week range of 1.26-4.23, average daily share volume of 3.1M, a public-listing history dating back to 2019, approximately 161 full-time employees. These structural characteristics shape how CABA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 3.17 indicates CABA 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 CABA?
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 CABA snapshot
As of May 15, 2026, spot at $3.33, ATM IV 85.80%, IV rank 8.88%, expected move 24.60%. The collar on CABA 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 CABA specifically: IV regime affects collar pricing on both sides; compressed CABA IV at 85.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 24.60% (roughly $0.82 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 CABA expiries trade a higher absolute premium for lower per-day decay. Position sizing on CABA should anchor to the underlying notional of $3.33 per share and to the trader's directional view on CABA stock.
CABA collar setup
The CABA 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 CABA near $3.33, the first option leg uses a $3.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CABA 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 CABA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $3.33 | long |
| Sell 1 | Call | $3.50 | N/A |
| Buy 1 | Put | $3.16 | N/A |
CABA 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.
CABA collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on CABA. 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 CABA
Collars on CABA hedge an existing long CABA 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.
CABA thesis for this collar
The market-implied 1-standard-deviation range for CABA extends from approximately $2.51 on the downside to $4.15 on the upside. A CABA collar hedges an existing long CABA 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 CABA IV rank near 8.88% 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 CABA at 85.80%. As a Healthcare name, CABA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CABA-specific events.
CABA 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. CABA positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CABA alongside the broader basket even when CABA-specific fundamentals are unchanged. Always rebuild the position from current CABA chain quotes before placing a trade.
Frequently asked questions
- What is a collar on CABA?
- A collar on CABA is the collar strategy applied to CABA (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 CABA stock trading near $3.33, the strikes shown on this page are snapped to the nearest listed CABA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are CABA 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 CABA collar priced from the end-of-day chain at a 30-day expiry (ATM IV 85.80%), 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 CABA collar?
- The breakeven for the CABA 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 CABA market-implied 1-standard-deviation expected move is approximately 24.60%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on CABA?
- Collars on CABA hedge an existing long CABA 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 CABA implied volatility affect this collar?
- CABA ATM IV is at 85.80% with IV rank near 8.88%, 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.