ESRT Collar Strategy
ESRT (Empire State Realty Trust, Inc.), in the Real Estate sector, (REIT - Diversified industry), listed on NYSE.
Empire State Realty Trust, Inc. (NYSE: ESRT), a leading real estate investment trust (REIT), owns, manages, operates, acquires and repositions office and retail properties in Manhattan and the greater New York metropolitan area, including the Empire State Building, the World's Most Famous Building. Headquartered in New York, New York, the Company's office and retail portfolio covers 10.1 million rentable square feet, as of September 30, 2020, consisting of 9.4 million rentable square feet in 14 office properties, including nine in Manhattan, three in Fairfield County, Connecticut, and two in Westchester County, New York; and approximately 700,000 rentable square feet in the retail portfolio. Long the leader in energy efficiency retrofits and Indoor Environmental Quality, Empire State Realty Trust is the first commercial real estate portfolio in the U.S. to achieve the WELL Health-Safety Rating.
ESRT (Empire State Realty Trust, Inc.) trades in the Real Estate sector, specifically REIT - Diversified, with a market capitalization of approximately $925.6M, a trailing P/E of 23.35, a beta of 1.36 versus the broader market, a 52-week range of 4.87-8.76, average daily share volume of 1.7M, a public-listing history dating back to 2013, approximately 667 full-time employees. These structural characteristics shape how ESRT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.36 indicates ESRT has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. ESRT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on ESRT?
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 ESRT snapshot
As of May 15, 2026, spot at $5.39, ATM IV 351.80%, IV rank 100.00%, expected move 100.86%. The collar on ESRT 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 ESRT specifically: IV regime affects collar pricing on both sides; elevated ESRT IV at 351.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 100.86% (roughly $5.44 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 ESRT expiries trade a higher absolute premium for lower per-day decay. Position sizing on ESRT should anchor to the underlying notional of $5.39 per share and to the trader's directional view on ESRT stock.
ESRT collar setup
The ESRT 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 ESRT near $5.39, the first option leg uses a $5.66 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ESRT 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 ESRT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $5.39 | long |
| Sell 1 | Call | $5.66 | N/A |
| Buy 1 | Put | $5.12 | N/A |
ESRT 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.
ESRT collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on ESRT. 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 ESRT
Collars on ESRT hedge an existing long ESRT 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.
ESRT thesis for this collar
The market-implied 1-standard-deviation range for ESRT extends from approximately $-0.05 on the downside to $10.83 on the upside. A ESRT collar hedges an existing long ESRT 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 ESRT IV rank near 100.00% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on ESRT at 351.80%. As a Real Estate name, ESRT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ESRT-specific events.
ESRT 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. ESRT positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ESRT alongside the broader basket even when ESRT-specific fundamentals are unchanged. Always rebuild the position from current ESRT chain quotes before placing a trade.
Frequently asked questions
- What is a collar on ESRT?
- A collar on ESRT is the collar strategy applied to ESRT (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 ESRT stock trading near $5.39, the strikes shown on this page are snapped to the nearest listed ESRT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ESRT 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 ESRT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 351.80%), 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 ESRT collar?
- The breakeven for the ESRT 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 ESRT market-implied 1-standard-deviation expected move is approximately 100.86%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on ESRT?
- Collars on ESRT hedge an existing long ESRT 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 ESRT implied volatility affect this collar?
- ESRT ATM IV is at 351.80% with IV rank near 100.00%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.