GWRE Collar Strategy
GWRE (Guidewire Software, Inc.), in the Technology sector, (Software - Application industry), listed on NYSE.
Guidewire Software, Inc. provides software products for property and casualty insurers worldwide. The company offers Guidewire InsuranceSuite comprising Guidewire PolicyCenter, BillingCenter, and ClaimCenter applications. It also provides Guidewire InsuranceNow, a cloud-based platform that offers policy, billing, and claims management functionality to insurers; and Guidewire InsuranceSuite for Self-Managed. In addition, the company offers Guidewire Rating Management to manage the pricing of insurance products; Guidewire Reinsurance Management to use rules-based logic to execute reinsurance strategy through underwriting and claims processes; Guidewire Client Data Management to capitalize on customer information; and Guidewire Product Content Management that offers software tools and standards-based line-of-business templates to introduce and modify products. Further, it provides Guidewire Underwriting Management, a cloud-based integrated business application; Guidewire AppReader, a submission intake management solution; Guidewire ClaimCenter Package for the London market supports the claims workflow used by London Market insurers and brokers; Guidewire Digital Engagement Applications, which enable insurers to provide digital experiences to customers, agents, vendors, and field personnel through their device of choice; and Guidewire for Salesforce to provide customer information regarding policies and claims. Additionally, the company offers Guidewire Predictive Analytics, a set of cloud-native applications; Guidewire Risk Insights that allows insurers to assess new and evolving risks; Guidewire Business Intelligence that allows insurers to measure business performance; Guidewire DataHub, an operational data store; and Guidewire InfoCenter, a business intelligence warehouse, as well as implementation and integration, and professional services.
GWRE (Guidewire Software, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $10.68B, a trailing P/E of 56.26, a beta of 0.91 versus the broader market, a 52-week range of 115.57-272.6, average daily share volume of 1.5M, a public-listing history dating back to 2012, approximately 4K full-time employees. These structural characteristics shape how GWRE stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.91 places GWRE roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 56.26 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple.
What is a collar on GWRE?
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 GWRE snapshot
As of May 15, 2026, spot at $129.74, ATM IV 71.70%, IV rank 66.35%, expected move 20.56%. The collar on GWRE 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 GWRE specifically: IV regime affects collar pricing on both sides; mid-range GWRE IV at 71.70% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 20.56% (roughly $26.67 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 GWRE expiries trade a higher absolute premium for lower per-day decay. Position sizing on GWRE should anchor to the underlying notional of $129.74 per share and to the trader's directional view on GWRE stock.
GWRE collar setup
The GWRE 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 GWRE near $129.74, the first option leg uses a $135.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed GWRE 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 GWRE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $129.74 | long |
| Sell 1 | Call | $135.00 | $9.20 |
| Buy 1 | Put | $125.00 | $8.80 |
GWRE collar risk and reward
- Net Premium / Debit
- -$12,934.00
- Max Profit (per contract)
- $566.00
- Max Loss (per contract)
- -$434.00
- Breakeven(s)
- $129.34
- Risk / Reward Ratio
- 1.304
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.
GWRE collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on GWRE. 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% | -$434.00 |
| $28.70 | -77.9% | -$434.00 |
| $57.38 | -55.8% | -$434.00 |
| $86.07 | -33.7% | -$434.00 |
| $114.75 | -11.6% | -$434.00 |
| $143.44 | +10.6% | +$566.00 |
| $172.12 | +32.7% | +$566.00 |
| $200.81 | +54.8% | +$566.00 |
| $229.49 | +76.9% | +$566.00 |
| $258.18 | +99.0% | +$566.00 |
When traders use collar on GWRE
Collars on GWRE hedge an existing long GWRE 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.
GWRE thesis for this collar
The market-implied 1-standard-deviation range for GWRE extends from approximately $103.07 on the downside to $156.41 on the upside. A GWRE collar hedges an existing long GWRE 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 GWRE IV rank near 66.35% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on GWRE should anchor more to the directional view and the expected-move geometry. As a Technology name, GWRE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to GWRE-specific events.
GWRE 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. GWRE positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move GWRE alongside the broader basket even when GWRE-specific fundamentals are unchanged. Always rebuild the position from current GWRE chain quotes before placing a trade.
Frequently asked questions
- What is a collar on GWRE?
- A collar on GWRE is the collar strategy applied to GWRE (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 GWRE stock trading near $129.74, the strikes shown on this page are snapped to the nearest listed GWRE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are GWRE 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 GWRE collar priced from the end-of-day chain at a 30-day expiry (ATM IV 71.70%), the computed maximum profit is $566.00 per contract and the computed maximum loss is -$434.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a GWRE collar?
- The breakeven for the GWRE collar priced on this page is roughly $129.34 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 GWRE market-implied 1-standard-deviation expected move is approximately 20.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on GWRE?
- Collars on GWRE hedge an existing long GWRE 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 GWRE implied volatility affect this collar?
- GWRE ATM IV is at 71.70% with IV rank near 66.35%, 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.