How are GD 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 GD collar priced from the end-of-day chain at a 30-day expiry (ATM IV 20.67%), the computed maximum profit is $1,567.50 per contract and the computed maximum loss is -$1,432.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a GD collar?

The breakeven for the GD collar priced on this page is roughly $334.33 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 GD market-implied 1-standard-deviation expected move is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current GD implied volatility affect this collar?

GD ATM IV is at 20.67% with IV rank near 39.09%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.

GD Collar Strategy

GD (General Dynamics Corporation), in the Industrials sector, (Aerospace & Defense industry), listed on NYSE.

General Dynamics Corporation operates as an aerospace and defense company worldwide. It operates through four segments: Aerospace, Marine Systems, Combat Systems, and Technologies. The Aerospace segment designs, manufactures, and sells business jets; and offers aircraft maintenance and repair, management, charter, aircraft-on-ground support and completion, staffing, and fixed-base operator services. The Marine Systems segment designs and builds nuclear-powered submarines, surface combatants, and auxiliary ships for the United States Navy and Jones Act ships for commercial customers, as well as builds crude oil and product tankers, and container and cargo ships. This segment also provides navy ships maintenance and modernization services; lifecycle support and repair services for navy surface ships; and program management, planning, engineering, and design support services for submarines and surface ships. The Combat Systems segment manufactures land combat solutions, such as wheeled and tracked combat vehicles, Stryker wheeled combat vehicles, piranha vehicles, weapons systems, munitions, mobile bridge systems with payloads, tactical vehicles, main battle tanks, armored vehicles, and armaments.

GD (General Dynamics Corporation) trades in the Industrials sector, specifically Aerospace & Defense, with a market capitalization of approximately $92.31B, a trailing P/E of 21.25, a beta of 0.35 versus the broader market, a 52-week range of 268.1-369.7, average daily share volume of 1.4M, a public-listing history dating back to 1978, approximately 110K full-time employees. These structural characteristics shape how GD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.35 indicates GD has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. GD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on GD?

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 GD snapshot

As of May 15, 2026, spot at $334.60, ATM IV 20.67%, IV rank 39.09%, expected move 5.93%. The collar on GD 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 28-day expiry.

Why this collar structure on GD specifically: IV regime affects collar pricing on both sides; mid-range GD IV at 20.67% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.93% (roughly $19.83 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated GD expiries trade a higher absolute premium for lower per-day decay. Position sizing on GD should anchor to the underlying notional of $334.60 per share and to the trader's directional view on GD stock.

GD collar setup

The GD 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 GD near $334.60, the first option leg uses a $350.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed GD chain at a 28-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 GD shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$334.60	long
Sell 1	Call	$350.00	$2.70
Buy 1	Put	$320.00	$2.43

GD collar risk and reward

Net Premium / Debit: -$33,432.50
Max Profit (per contract): $1,567.50
Max Loss (per contract): -$1,432.50
Breakeven(s): $334.33
Risk / Reward Ratio: 1.094

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.

GD collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on GD. 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%	-$1,432.50
$73.99	-77.9%	-$1,432.50
$147.97	-55.8%	-$1,432.50
$221.95	-33.7%	-$1,432.50
$295.93	-11.6%	-$1,432.50
$369.91	+10.6%	+$1,567.50
$443.89	+32.7%	+$1,567.50
$517.88	+54.8%	+$1,567.50
$591.86	+76.9%	+$1,567.50
$665.84	+99.0%	+$1,567.50

When traders use collar on GD

Collars on GD hedge an existing long GD 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.

GD thesis for this collar

The market-implied 1-standard-deviation range for GD extends from approximately $314.77 on the downside to $354.43 on the upside. A GD collar hedges an existing long GD 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 GD IV rank near 39.09% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on GD should anchor more to the directional view and the expected-move geometry. As a Industrials name, GD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to GD-specific events.

GD 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. GD positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move GD alongside the broader basket even when GD-specific fundamentals are unchanged. Always rebuild the position from current GD chain quotes before placing a trade.

Frequently asked questions

What is a collar on GD?: A collar on GD is the collar strategy applied to GD (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 GD stock trading near $334.60, the strikes shown on this page are snapped to the nearest listed GD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are GD 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 GD collar priced from the end-of-day chain at a 30-day expiry (ATM IV 20.67%), the computed maximum profit is $1,567.50 per contract and the computed maximum loss is -$1,432.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a GD collar?: The breakeven for the GD collar priced on this page is roughly $334.33 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 GD market-implied 1-standard-deviation expected move is approximately 5.93%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on GD?: Collars on GD hedge an existing long GD 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 GD implied volatility affect this collar?: GD ATM IV is at 20.67% with IV rank near 39.09%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.