CL Collar Strategy
CL (Colgate-Palmolive Company), in the Consumer Defensive sector, (Household & Personal Products industry), listed on NYSE.
Operating globally, Colgate-Palmolive Company and its affiliated entities are engaged in the production and distribution of a diverse range of consumer goods. Its operations are structured into two primary divisions: Oral, Personal and Home Care, and Pet Nutrition. The Oral, Personal and Home Care division encompasses a broad array of offerings, spanning oral hygiene (e.g., toothpastes, toothbrushes, mouthwashes), personal care (e.g., bar and liquid soaps, shower gels, shampoos, conditioners, deodorants, antiperspirants, skin health items), and home care solutions (e.g., dishwashing detergents, fabric conditioners, household cleaners). These products are distributed through various channels, including traditional and online retailers, wholesalers, and distributors, under well-known brand names such as Colgate, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, Irish Spring, Palmolive, Protex, Sanex, Softsoap, Lady Speed Stick, Speed Stick, EltaMD, Filorga, PCA SKIN, Ajax, Axion, Fabuloso, Murphy, Suavitel, Soupline, and Cuddly. Furthermore, this segment supplies specialized pharmaceutical products to dentists and other professionals in oral healthcare. Conversely, the Pet Nutrition segment focuses on providing specialized pet food.
CL (Colgate-Palmolive Company) trades in the Consumer Defensive sector, specifically Household & Personal Products, with a market capitalization of approximately $68.86B, a trailing P/E of 33.65, a beta of 0.32 versus the broader market, a 52-week range of 74.55-99.33, average daily share volume of 5.0M, a public-listing history dating back to 1973, approximately 34K full-time employees. These structural characteristics shape how CL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.32 indicates CL has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. CL pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on CL?
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.
CL snapshot
As of September 29, 2026, spot at $86.49, ATM IV 24.64%, IV rank 50.82%, expected move 7.07%. The collar on CL below is built from the September 29, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 31-day expiry.
Why this collar structure on CL specifically: IV regime affects collar pricing on both sides; mid-range CL IV at 24.64% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.07% (roughly $6.11 on the underlying). The 31-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CL expiries trade a higher absolute premium for lower per-day decay. Position sizing on CL should anchor to the underlying notional of $86.49 per share and to the trader's directional view on CL stock.
CL collar setup
The CL collar below is built from the September 29, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With CL at $86.49 on that close, the first option leg uses a $91.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CL chain at a 31-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 CL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $86.49 | long |
| Sell 1 | Call | $91.00 | $0.80 |
| Buy 1 | Put | $82.00 | $1.00 |
CL collar risk and reward
- Net Premium / Debit
- -$8,669.00
- Max Profit (per contract)
- $431.00
- Max Loss (per contract)
- -$469.00
- Breakeven(s)
- $86.69
- Risk / Reward Ratio
- 0.919
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.
CL collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on CL. 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% | -$469.00 |
| $19.13 | -77.9% | -$469.00 |
| $38.25 | -55.8% | -$469.00 |
| $57.38 | -33.7% | -$469.00 |
| $76.50 | -11.6% | -$469.00 |
| $95.62 | +10.6% | +$431.00 |
| $114.74 | +32.7% | +$431.00 |
| $133.87 | +54.8% | +$431.00 |
| $152.99 | +76.9% | +$431.00 |
| $172.11 | +99.0% | +$431.00 |
When traders use collar on CL
Collars on CL hedge an existing long CL 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.
CL thesis for this collar
The market-implied 1-standard-deviation range for CL extends from approximately $80.38 on the downside to $92.60 on the upside. A CL collar hedges an existing long CL 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 CL IV rank near 50.82% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on CL should anchor more to the directional view and the expected-move geometry. As a Consumer Defensive name, CL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CL-specific events.
CL 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. CL positions also carry Consumer Defensive sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CL alongside the broader basket even when CL-specific fundamentals are unchanged. Always rebuild the position from current CL chain quotes before placing a trade.
Frequently asked questions
- What is a collar on CL?
- A collar on CL is the collar strategy applied to CL (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 CL stock at $86.49 on the September 29, 2026 close, the strikes shown on this page are snapped to the nearest listed CL chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are CL 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 CL collar priced from the September 29, 2026 end-of-day chain at a 30-day expiry (ATM IV 24.64%), the computed maximum profit is $431.00 per contract and the computed maximum loss is -$469.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a CL collar?
- The breakeven for the CL collar priced on this page is roughly $86.69 at expiration, derived from the September 29, 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 CL market-implied 1-standard-deviation expected move in the same options snapshot is approximately 7.07%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on CL?
- Collars on CL hedge an existing long CL 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 CL implied volatility affect this collar?
- CL ATM IV is at 24.64% with IV rank near 50.82%, 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.