How are HUM 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 HUM collar priced from the end-of-day chain at a 30-day expiry (ATM IV 51.22%), the computed maximum profit is $2,041.00 per contract and the computed maximum loss is -$1,959.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a HUM collar?

The breakeven for the HUM collar priced on this page is roughly $389.59 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 HUM market-implied 1-standard-deviation expected move is approximately 14.69%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current HUM implied volatility affect this collar?

HUM ATM IV is at 51.22% with IV rank near 44.18%, 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.

HUM Collar Strategy

HUM (Humana Inc.), in the Healthcare sector, (Medical - Healthcare Plans industry), listed on NYSE.

Humana Inc., a prominent health and well-being enterprise, operates across the United States through its various subsidiary companies. Its operational structure is divided into three main segments: Retail, Group and Specialty, and Healthcare Services. The firm provides a wide array of medical and supplementary insurance plans directly to individual consumers. Furthermore, Humana collaborates with government entities; it holds a contract with the Centers for Medicare and Medicaid Services (CMS) to manage the Limited Income Newly Eligible Transition (LI NET) prescription drug program. The company also secures agreements with numerous states to deliver Medicaid, dual-eligible, and long-term care support benefits. For employer groups and individuals, Humana furnishes fully insured commercial medical and specialized health coverage, which encompasses dental, vision, and other ancillary health benefits.

HUM (Humana Inc.) trades in the Healthcare sector, specifically Medical - Healthcare Plans, with a market capitalization of approximately $46.08B, a trailing P/E of 40.87, a beta of 0.77 versus the broader market, a 52-week range of 163.11-385.49, average daily share volume of 1.7M, a public-listing history dating back to 1981, approximately 66K full-time employees. These structural characteristics shape how HUM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.77 places HUM roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 40.87 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. HUM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on HUM?

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 HUM snapshot

As of June 29, 2026, spot at $388.94, ATM IV 51.22%, IV rank 44.18%, expected move 14.69%. The collar on HUM 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 32-day expiry.

Why this collar structure on HUM specifically: IV regime affects collar pricing on both sides; mid-range HUM IV at 51.22% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 14.69% (roughly $57.12 on the underlying). The 32-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated HUM expiries trade a higher absolute premium for lower per-day decay. Position sizing on HUM should anchor to the underlying notional of $388.94 per share and to the trader's directional view on HUM stock.

HUM collar setup

The HUM 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 HUM near $388.94, the first option leg uses a $410.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HUM chain at a 32-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 HUM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$388.94	long
Sell 1	Call	$410.00	$14.95
Buy 1	Put	$370.00	$15.60

HUM collar risk and reward

Net Premium / Debit: -$38,959.00
Max Profit (per contract): $2,041.00
Max Loss (per contract): -$1,959.00
Breakeven(s): $389.59
Risk / Reward Ratio: 1.042

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.

HUM collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on HUM. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$1,959.00
$86.01	-77.9%	-$1,959.00
$172.00	-55.8%	-$1,959.00
$258.00	-33.7%	-$1,959.00
$343.99	-11.6%	-$1,959.00
$429.99	+10.6%	+$2,041.00
$515.98	+32.7%	+$2,041.00
$601.98	+54.8%	+$2,041.00
$687.98	+76.9%	+$2,041.00
$773.97	+99.0%	+$2,041.00

When traders use collar on HUM

Collars on HUM hedge an existing long HUM 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.

HUM thesis for this collar

The market-implied 1-standard-deviation range for HUM extends from approximately $331.82 on the downside to $446.06 on the upside. A HUM collar hedges an existing long HUM 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 HUM IV rank near 44.18% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on HUM should anchor more to the directional view and the expected-move geometry. As a Healthcare name, HUM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HUM-specific events.

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

Frequently asked questions

What is a collar on HUM?: A collar on HUM is the collar strategy applied to HUM (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 HUM stock trading near $388.94, the strikes shown on this page are snapped to the nearest listed HUM chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are HUM 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 HUM collar priced from the end-of-day chain at a 30-day expiry (ATM IV 51.22%), the computed maximum profit is $2,041.00 per contract and the computed maximum loss is -$1,959.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a HUM collar?: The breakeven for the HUM collar priced on this page is roughly $389.59 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 HUM market-implied 1-standard-deviation expected move is approximately 14.69%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on HUM?: Collars on HUM hedge an existing long HUM 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 HUM implied volatility affect this collar?: HUM ATM IV is at 51.22% with IV rank near 44.18%, 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.