DSGX Collar Strategy
DSGX (The Descartes Systems Group Inc.), in the Technology sector, (Software - Application industry), listed on NASDAQ.
The Descartes Systems Group Inc. provides cloud-based logistics and supply chain management business process solutions that focuses on enhancing the productivity, performance, and security of logistics-intensive businesses worldwide. Its Logistics Technology platform offers a range of modular, cloud-based, and interoperable web and wireless logistics management applications, which unites a community of logistics-focused parties, allowing them to transact business. The company provides a suite of solutions that include routing, mobile and telematics; transportation management and e-commerce enablement; customs and regulatory compliance; trade data; global logistics network services; and broker and forwarder enterprise systems. It offers its customers to use its modular, software-as-a-service, and data solutions to route, schedule, track, and measure delivery resources; plan, allocate, and execute shipments; rate, audit, and pay transportation invoices; access and analyze global trade data; research and perform trade tariff and duty calculations; file customs and security documents for imports and exports; and various other logistics processes. The company also provides cloud-based ecommerce warehouse management solutions; consulting, implementation, and training services; and maintenance and support services. It primarily focuses on serving transportation providers, logistics service providers, and distribution-intensive companies, as well as manufacturers, retailers, distributors, and mobile business service providers.
DSGX (The Descartes Systems Group Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $5.70B, a trailing P/E of 34.67, a beta of 0.18 versus the broader market, a 52-week range of 62.56-117.35, average daily share volume of 621K, a public-listing history dating back to 1999, approximately 1K full-time employees. These structural characteristics shape how DSGX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.18 indicates DSGX has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a collar on DSGX?
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 DSGX snapshot
As of May 15, 2026, spot at $67.75, ATM IV 47.60%, IV rank 6.89%, expected move 13.65%. The collar on DSGX 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 DSGX specifically: IV regime affects collar pricing on both sides; compressed DSGX IV at 47.60% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 13.65% (roughly $9.25 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 DSGX expiries trade a higher absolute premium for lower per-day decay. Position sizing on DSGX should anchor to the underlying notional of $67.75 per share and to the trader's directional view on DSGX stock.
DSGX collar setup
The DSGX 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 DSGX near $67.75, the first option leg uses a $70.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed DSGX 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 DSGX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $67.75 | long |
| Sell 1 | Call | $70.00 | $2.98 |
| Buy 1 | Put | $65.00 | $2.90 |
DSGX collar risk and reward
- Net Premium / Debit
- -$6,767.50
- Max Profit (per contract)
- $232.50
- Max Loss (per contract)
- -$267.50
- Breakeven(s)
- $67.68
- Risk / Reward Ratio
- 0.869
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.
DSGX collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on DSGX. 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% | -$267.50 |
| $14.99 | -77.9% | -$267.50 |
| $29.97 | -55.8% | -$267.50 |
| $44.95 | -33.7% | -$267.50 |
| $59.93 | -11.5% | -$267.50 |
| $74.90 | +10.6% | +$232.50 |
| $89.88 | +32.7% | +$232.50 |
| $104.86 | +54.8% | +$232.50 |
| $119.84 | +76.9% | +$232.50 |
| $134.82 | +99.0% | +$232.50 |
When traders use collar on DSGX
Collars on DSGX hedge an existing long DSGX 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.
DSGX thesis for this collar
The market-implied 1-standard-deviation range for DSGX extends from approximately $58.50 on the downside to $77.00 on the upside. A DSGX collar hedges an existing long DSGX 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 DSGX IV rank near 6.89% 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 DSGX at 47.60%. As a Technology name, DSGX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to DSGX-specific events.
DSGX 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. DSGX positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move DSGX alongside the broader basket even when DSGX-specific fundamentals are unchanged. Always rebuild the position from current DSGX chain quotes before placing a trade.
Frequently asked questions
- What is a collar on DSGX?
- A collar on DSGX is the collar strategy applied to DSGX (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 DSGX stock trading near $67.75, the strikes shown on this page are snapped to the nearest listed DSGX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are DSGX 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 DSGX collar priced from the end-of-day chain at a 30-day expiry (ATM IV 47.60%), the computed maximum profit is $232.50 per contract and the computed maximum loss is -$267.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a DSGX collar?
- The breakeven for the DSGX collar priced on this page is roughly $67.68 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 DSGX market-implied 1-standard-deviation expected move is approximately 13.65%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on DSGX?
- Collars on DSGX hedge an existing long DSGX 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 DSGX implied volatility affect this collar?
- DSGX ATM IV is at 47.60% with IV rank near 6.89%, 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.