FBNC Collar Strategy
FBNC (First Bancorp), in the Financial Services sector, (Banks - Regional industry), listed on NASDAQ.
First Bancorp operates as the bank holding company for First Bank that provides banking products and services for individuals and small to medium-sized businesses primarily in North Carolina and northeastern South Carolina. It accepts deposit products, such as checking, savings, and money market accounts, as well as time deposits, including certificate of deposits and individual retirement accounts. The company also offers loans for a range of consumer and commercial purposes comprising loans for business, real estate, personal, home improvement, and automobiles, as well as residential mortgages and small business administration loans; and accounts receivable financing and factoring, inventory financing, and purchase order financing services. In addition, it provides credit and debit cards, letter of credits, and safe deposit box rental services, as well as electronic funds transfer services consisting of wire transfers; and internet and mobile banking, cash management, bank-by-phone services, and remote deposit capture services. Further, the company offers investment and insurance products, such as mutual funds, annuities, long-term care insurance, life insurance, and company retirement plans, as well as property and casualty insurance products; and financial planning services. As of December 31, 2021, it operated 121 branches comprising 114 branch offices located in North Carolina and seven branches in South Carolina.
FBNC (First Bancorp) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $2.39B, a trailing P/E of 19.71, a beta of 0.83 versus the broader market, a 52-week range of 40-62.64, average daily share volume of 215K, a public-listing history dating back to 1987, approximately 1K full-time employees. These structural characteristics shape how FBNC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.83 places FBNC roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. FBNC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on FBNC?
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 FBNC snapshot
As of May 15, 2026, spot at $57.49, ATM IV 46.40%, IV rank 16.04%, expected move 13.30%. The collar on FBNC 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 FBNC specifically: IV regime affects collar pricing on both sides; compressed FBNC IV at 46.40% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 13.30% (roughly $7.65 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 FBNC expiries trade a higher absolute premium for lower per-day decay. Position sizing on FBNC should anchor to the underlying notional of $57.49 per share and to the trader's directional view on FBNC stock.
FBNC collar setup
The FBNC 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 FBNC near $57.49, the first option leg uses a $60.36 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FBNC 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 FBNC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $57.49 | long |
| Sell 1 | Call | $60.36 | N/A |
| Buy 1 | Put | $54.62 | N/A |
FBNC 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.
FBNC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on FBNC. 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 FBNC
Collars on FBNC hedge an existing long FBNC 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.
FBNC thesis for this collar
The market-implied 1-standard-deviation range for FBNC extends from approximately $49.84 on the downside to $65.14 on the upside. A FBNC collar hedges an existing long FBNC 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 FBNC IV rank near 16.04% 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 FBNC at 46.40%. As a Financial Services name, FBNC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FBNC-specific events.
FBNC 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. FBNC positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FBNC alongside the broader basket even when FBNC-specific fundamentals are unchanged. Always rebuild the position from current FBNC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on FBNC?
- A collar on FBNC is the collar strategy applied to FBNC (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 FBNC stock trading near $57.49, the strikes shown on this page are snapped to the nearest listed FBNC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are FBNC 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 FBNC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 46.40%), 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 FBNC collar?
- The breakeven for the FBNC 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 FBNC market-implied 1-standard-deviation expected move is approximately 13.30%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on FBNC?
- Collars on FBNC hedge an existing long FBNC 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 FBNC implied volatility affect this collar?
- FBNC ATM IV is at 46.40% with IV rank near 16.04%, 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.