DKL Collar Strategy
DKL (Delek Logistics Partners, LP), in the Energy sector, (Oil & Gas Midstream industry), listed on NYSE.
Delek Logistics Partners, LP (DKL) manages and operates a diverse portfolio of logistics and marketing assets for crude oil, intermediate, and refined petroleum products throughout the United States. The company's operations are structured into three primary segments: Pipelines and Transportation, Wholesale Marketing and Terminalling, and Investments in Pipeline Joint Ventures. The Pipelines and Transportation division encompasses a comprehensive network of pipelines, trucking fleets, and supporting facilities. It provides essential services such as crude oil gathering, the movement of crude, intermediate, and refined products, and storage solutions. These services primarily bolster the operations of the Tyler, El Dorado, and Big Spring refineries, while also extending transport capabilities for crude and other products to external clients. This segment includes approximately 400 miles of crude oil transportation pipelines and 450 miles of refined product pipelines.
DKL (Delek Logistics Partners, LP) trades in the Energy sector, specifically Oil & Gas Midstream, with a market capitalization of approximately $2.70B, a trailing P/E of 16.00, a beta of 0.45 versus the broader market, a 52-week range of 41.72-55.89, average daily share volume of 78K, a public-listing history dating back to 2012. These structural characteristics shape how DKL stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.45 indicates DKL has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. DKL pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on DKL?
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 DKL snapshot
As of June 30, 2026, spot at $51.77, ATM IV 22.20%, IV rank 2.90%, expected move 6.36%. The collar on DKL 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 17-day expiry.
Why this collar structure on DKL specifically: IV regime affects collar pricing on both sides; compressed DKL IV at 22.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.36% (roughly $3.29 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated DKL expiries trade a higher absolute premium for lower per-day decay. Position sizing on DKL should anchor to the underlying notional of $51.77 per share and to the trader's directional view on DKL stock.
DKL collar setup
The DKL 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 DKL near $51.77, the first option leg uses a $54.36 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed DKL chain at a 17-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 DKL shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $51.77 | long |
| Sell 1 | Call | $54.36 | N/A |
| Buy 1 | Put | $49.18 | N/A |
DKL 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.
DKL collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on DKL. 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 DKL
Collars on DKL hedge an existing long DKL 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.
DKL thesis for this collar
The market-implied 1-standard-deviation range for DKL extends from approximately $48.48 on the downside to $55.06 on the upside. A DKL collar hedges an existing long DKL 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 DKL IV rank near 2.90% 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 DKL at 22.20%. As a Energy name, DKL options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to DKL-specific events.
DKL 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. DKL positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move DKL alongside the broader basket even when DKL-specific fundamentals are unchanged. Always rebuild the position from current DKL chain quotes before placing a trade.
Frequently asked questions
- What is a collar on DKL?
- A collar on DKL is the collar strategy applied to DKL (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 DKL stock trading near $51.77, the strikes shown on this page are snapped to the nearest listed DKL chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are DKL 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 DKL collar priced from the end-of-day chain at a 30-day expiry (ATM IV 22.20%), 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 DKL collar?
- The breakeven for the DKL 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 DKL market-implied 1-standard-deviation expected move is approximately 6.36%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on DKL?
- Collars on DKL hedge an existing long DKL 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 DKL implied volatility affect this collar?
- DKL ATM IV is at 22.20% with IV rank near 2.90%, 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.