How are CPK 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 CPK collar priced from the end-of-day chain at a 30-day expiry (ATM IV 21.90%), the computed maximum profit is $499.50 per contract and the computed maximum loss is -$500.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a CPK collar?

The breakeven for the CPK collar priced on this page is roughly $125.01 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 CPK market-implied 1-standard-deviation expected move is approximately 6.28%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current CPK implied volatility affect this collar?

CPK ATM IV is at 21.90% with IV rank near 2.23%, 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.

CPK Collar Strategy

CPK (Chesapeake Utilities Corporation), in the Utilities sector, (Regulated Gas industry), listed on NYSE.

Chesapeake Utilities Corporation operates as an energy delivery company. The company operates through two segments, Regulated Energy and Unregulated Energy. The Regulated Energy segment engages in the natural gas distribution operations in central and southern Delaware, Maryland's eastern shore, and Florida; regulated natural gas transmission in the Delmarva Peninsula and Florida; and regulated electric distribution in northeast and northwest Florida. The Unregulated Energy segment engages in the propane operations in the Mid-Atlantic region, North Carolina, South Carolina, and Florida; unregulated natural gas transmission/supply operation in central and eastern Ohio; generation of electricity and steam; and provision of compressed natural gas, liquefied natural gas, and renewable natural gas transportation and pipeline solutions primarily to utilities and pipelines in the eastern United States. This segment also provides other unregulated energy services, such as energy-related merchandise sales; heating, ventilation, and air conditioning services; and plumbing and electrical services. The company was founded in 1859 and is headquartered in Dover, Delaware.

CPK (Chesapeake Utilities Corporation) trades in the Utilities sector, specifically Regulated Gas, with a market capitalization of approximately $3.03B, a trailing P/E of 20.35, a beta of 0.72 versus the broader market, a 52-week range of 116.3-140.59, average daily share volume of 146K, a public-listing history dating back to 1980, approximately 1K full-time employees. These structural characteristics shape how CPK stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.72 places CPK roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. CPK pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on CPK?

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 CPK snapshot

As of May 15, 2026, spot at $124.95, ATM IV 21.90%, IV rank 2.23%, expected move 6.28%. The collar on CPK 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 CPK specifically: IV regime affects collar pricing on both sides; compressed CPK IV at 21.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.28% (roughly $7.85 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 CPK expiries trade a higher absolute premium for lower per-day decay. Position sizing on CPK should anchor to the underlying notional of $124.95 per share and to the trader's directional view on CPK stock.

CPK collar setup

The CPK 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 CPK near $124.95, the first option leg uses a $130.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CPK 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 CPK shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$124.95	long
Sell 1	Call	$130.00	$1.57
Buy 1	Put	$120.00	$1.63

CPK collar risk and reward

Net Premium / Debit: -$12,500.50
Max Profit (per contract): $499.50
Max Loss (per contract): -$500.50
Breakeven(s): $125.01
Risk / Reward Ratio: 0.998

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.

CPK collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on CPK. 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%	-$500.50
$27.64	-77.9%	-$500.50
$55.26	-55.8%	-$500.50
$82.89	-33.7%	-$500.50
$110.51	-11.6%	-$500.50
$138.14	+10.6%	+$499.50
$165.77	+32.7%	+$499.50
$193.39	+54.8%	+$499.50
$221.02	+76.9%	+$499.50
$248.64	+99.0%	+$499.50

When traders use collar on CPK

Collars on CPK hedge an existing long CPK 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.

CPK thesis for this collar

The market-implied 1-standard-deviation range for CPK extends from approximately $117.10 on the downside to $132.80 on the upside. A CPK collar hedges an existing long CPK 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 CPK IV rank near 2.23% 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 CPK at 21.90%. As a Utilities name, CPK options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CPK-specific events.

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

Frequently asked questions

What is a collar on CPK?: A collar on CPK is the collar strategy applied to CPK (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 CPK stock trading near $124.95, the strikes shown on this page are snapped to the nearest listed CPK chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are CPK 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 CPK collar priced from the end-of-day chain at a 30-day expiry (ATM IV 21.90%), the computed maximum profit is $499.50 per contract and the computed maximum loss is -$500.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CPK collar?: The breakeven for the CPK collar priced on this page is roughly $125.01 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 CPK market-implied 1-standard-deviation expected move is approximately 6.28%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on CPK?: Collars on CPK hedge an existing long CPK 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 CPK implied volatility affect this collar?: CPK ATM IV is at 21.90% with IV rank near 2.23%, 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.