GRC Collar Strategy
GRC (The Gorman-Rupp Company), in the Industrials sector, (Industrial - Machinery industry), listed on NYSE.
The Gorman-Rupp Company specializes in the design, production, and distribution of a broad spectrum of pumps and associated systems, serving markets both within the United States and globally. Their comprehensive portfolio encompasses a wide array of pump types, such as self-priming, standard, and magnetic drive centrifugal units; axial and mixed flow designs; vertical turbine line shaft, submersible, and high-pressure booster pumps; alongside rotary gear, diaphragm, bellows, and oscillating models. These versatile solutions are essential across numerous sectors, including municipal water and wastewater management, building and infrastructure projects, dewatering operations, diverse industrial processes, the petroleum industry, original equipment manufacturing (OEM), agricultural irrigation, fire suppression systems, military applications, and general fluid transfer, including heating, ventilating, and air conditioning (HVAC). To reach its diverse clientele, the company employs a multi-channel sales strategy, leveraging an established network of distributors and independent manufacturers' representatives, sales via third-party catalogs, direct engagement with customers, and e-commerce platforms. Established in 1933, The Gorman-Rupp Company maintains its corporate headquarters in Mansfield, Ohio.
GRC (The Gorman-Rupp Company) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $2.15B, a trailing P/E of 34.47, a beta of 1.30 versus the broader market, a 52-week range of 41.02-92.78, average daily share volume of 184K, a public-listing history dating back to 1980, approximately 1K full-time employees. These structural characteristics shape how GRC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.30 places GRC roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. GRC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on GRC?
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.
GRC snapshot
As of August 14, 2026, spot at $80.68, ATM IV 37.00%, IV rank 13.53%, expected move 10.61%. The collar on GRC 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 126-day expiry.
Why this collar structure on GRC specifically: IV regime affects collar pricing on both sides; compressed GRC IV at 37.00% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.61% (roughly $8.56 on the underlying). The 126-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated GRC expiries trade a higher absolute premium for lower per-day decay. Position sizing on GRC should anchor to the underlying notional of $80.68 per share and to the trader's directional view on GRC stock.
GRC collar setup
The GRC 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 GRC at $80.68 on that close, the first option leg uses a $85.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed GRC chain at a 126-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 GRC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $80.68 | long |
| Sell 1 | Call | $85.00 | $5.60 |
| Buy 1 | Put | $75.00 | $4.15 |
GRC collar risk and reward
- Net Premium / Debit
- -$7,923.00
- Max Profit (per contract)
- $577.00
- Max Loss (per contract)
- -$423.00
- Breakeven(s)
- $79.23
- Risk / Reward Ratio
- 1.364
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.
GRC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on GRC. 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% | -$423.00 |
| $17.85 | -77.9% | -$423.00 |
| $35.69 | -55.8% | -$423.00 |
| $53.52 | -33.7% | -$423.00 |
| $71.36 | -11.6% | -$423.00 |
| $89.20 | +10.6% | +$577.00 |
| $107.04 | +32.7% | +$577.00 |
| $124.87 | +54.8% | +$577.00 |
| $142.71 | +76.9% | +$577.00 |
| $160.55 | +99.0% | +$577.00 |
When traders use collar on GRC
Collars on GRC hedge an existing long GRC 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.
GRC thesis for this collar
The market-implied 1-standard-deviation range for GRC extends from approximately $72.12 on the downside to $89.24 on the upside. A GRC collar hedges an existing long GRC 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 GRC IV rank near 13.53% 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 GRC at 37.00%. As a Industrials name, GRC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to GRC-specific events.
GRC 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. GRC positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move GRC alongside the broader basket even when GRC-specific fundamentals are unchanged. Always rebuild the position from current GRC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on GRC?
- A collar on GRC is the collar strategy applied to GRC (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 GRC stock at $80.68 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed GRC chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are GRC 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 GRC collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 37.00%), the computed maximum profit is $577.00 per contract and the computed maximum loss is -$423.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a GRC collar?
- The breakeven for the GRC collar priced on this page is roughly $79.23 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 GRC market-implied 1-standard-deviation expected move in the same options snapshot is approximately 10.61%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on GRC?
- Collars on GRC hedge an existing long GRC 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 GRC implied volatility affect this collar?
- GRC ATM IV is at 37.00% with IV rank near 13.53%, 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.