FHN Collar Strategy
FHN (First Horizon Corporation), in the Financial Services sector, (Banks - Regional industry), listed on NYSE.
First Horizon Corporation functions as the parent company of First Horizon Bank, offering a diverse range of financial services. Its operations are segmented into three core divisions: Regional Banking, Specialty Banking, and Corporate. The company provides standard banking services to consumers, businesses, financial institutions, and governmental bodies. Beyond core banking, it also underwrites eligible securities, such as fixed-income instruments, via its financial subsidiaries; engages in the sale of loans and derivatives; and provides advisory services. Its broad service portfolio further encompasses mortgage banking, title insurance and loan-closing, brokerage, correspondent banking, nationwide check clearing and remittance, trust and fiduciary functions, equipment financing, and both investment and financial advisory. Additionally, First Horizon markets mutual funds, retail insurance products, and credit cards.
FHN (First Horizon Corporation) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $12.28B, a trailing P/E of 11.63, a beta of 0.62 versus the broader market, a 52-week range of 19.8-26.56, average daily share volume of 4.9M, a public-listing history dating back to 1980, approximately 7K full-time employees. These structural characteristics shape how FHN stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.62 indicates FHN has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. The trailing P/E of 11.63 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. FHN pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on FHN?
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.
FHN snapshot
As of August 14, 2026, spot at $26.22, ATM IV 22.90%, IV rank 8.94%, expected move 6.57%. The collar on FHN below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 7-day expiry.
Why this collar structure on FHN specifically: IV regime affects collar pricing on both sides; compressed FHN IV at 22.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.57% (roughly $1.72 on the underlying). The 7-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated FHN expiries trade a higher absolute premium for lower per-day decay. Position sizing on FHN should anchor to the underlying notional of $26.22 per share and to the trader's directional view on FHN stock.
FHN collar setup
The FHN collar below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With FHN at $26.22 on that close, the first option leg uses a $27.53 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FHN chain at a 7-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 FHN shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $26.22 | long |
| Sell 1 | Call | $27.53 | N/A |
| Buy 1 | Put | $24.91 | N/A |
FHN 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.
FHN collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on FHN. 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 FHN
Collars on FHN hedge an existing long FHN 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.
FHN thesis for this collar
The market-implied 1-standard-deviation range for FHN extends from approximately $24.50 on the downside to $27.94 on the upside. A FHN collar hedges an existing long FHN 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 FHN IV rank near 8.94% 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 FHN at 22.90%. As a Financial Services name, FHN options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FHN-specific events.
FHN 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. FHN positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move FHN alongside the broader basket even when FHN-specific fundamentals are unchanged. Always rebuild the position from current FHN chain quotes before placing a trade.
Frequently asked questions
- What is a collar on FHN?
- A collar on FHN is the collar strategy applied to FHN (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 FHN stock at $26.22 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed FHN chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are FHN 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 FHN collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 22.90%), 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 FHN collar?
- The breakeven for the FHN collar priced on this page is no defined breakeven on the modeled curve at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The FHN market-implied 1-standard-deviation expected move in the same options snapshot is approximately 6.57%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on FHN?
- Collars on FHN hedge an existing long FHN 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 FHN implied volatility affect this collar?
- FHN ATM IV is at 22.90% with IV rank near 8.94%, 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.