How are MDT 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 MDT collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 29.60%), the computed maximum profit is $502.50 per contract and the computed maximum loss is -$397.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a MDT collar?

The breakeven for the MDT collar priced on this page is roughly $90.98 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 MDT market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.49%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current MDT implied volatility affect this collar?

MDT ATM IV is at 29.60% with IV rank near 71.97%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.

MDT Collar Strategy

MDT (Medtronic plc), in the Healthcare sector, (Medical - Devices industry), listed on NYSE.

Medtronic plc is a leading global medical technology enterprise that invents, develops, manufactures, and distributes an extensive range of device-based medical therapies. These solutions serve healthcare systems, clinicians, physicians, and patients across the world. The company's operations are categorized into several key portfolios: Cardiovascular Portfolio: This segment focuses on cardiac health, providing technologies for heart rhythm management, including implantable pacemakers, defibrillators, and monitoring systems, alongside cardiac ablation tools and remote patient software. It also addresses structural heart issues with products like aortic and pulmonary valves, surgical repair devices, and endovascular stent grafts, in addition to offerings for percutaneous coronary interventions (e.g., angioplasty balloons). Medical Surgical Portfolio: Offering a broad spectrum of surgical instruments and therapies, this division includes staples, vessel sealing devices, wound closure products, and electrosurgical equipment. It also pioneers surgical artificial intelligence and robotic-assisted platforms, alongside solutions for hernia repair, gynecology, lung conditions, minimally invasive gastrointestinal and hepatologic diagnostics, patient monitoring, airway management, ventilation therapies, and renal disease.

MDT (Medtronic plc) trades in the Healthcare sector, specifically Medical - Devices, with a market capitalization of approximately $116.83B, a trailing P/E of 24.37, a beta of 0.57 versus the broader market, a 52-week range of 73.31-106.33, average daily share volume of 9.4M, a public-listing history dating back to 1973, approximately 95K full-time employees. These structural characteristics shape how MDT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.57 indicates MDT has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. MDT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on MDT?

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.

MDT snapshot

As of August 14, 2026, spot at $91.37, ATM IV 29.60%, IV rank 71.97%, expected move 8.49%. The collar on MDT 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 28-day expiry.

Why this collar structure on MDT specifically: IV regime affects collar pricing on both sides; elevated MDT IV at 29.60% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 8.49% (roughly $7.75 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 MDT expiries trade a higher absolute premium for lower per-day decay. Position sizing on MDT should anchor to the underlying notional of $91.37 per share and to the trader's directional view on MDT stock.

MDT collar setup

The MDT 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 MDT at $91.37 on that close, the first option leg uses a $96.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MDT 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 MDT shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$91.37	long
Sell 1	Call	$96.00	$1.47
Buy 1	Put	$87.00	$1.08

MDT collar risk and reward

Net Premium / Debit: -$9,097.50
Max Profit (per contract): $502.50
Max Loss (per contract): -$397.50
Breakeven(s): $90.98
Risk / Reward Ratio: 1.264

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.

MDT collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on MDT. 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%	-$397.50
$20.21	-77.9%	-$397.50
$40.41	-55.8%	-$397.50
$60.61	-33.7%	-$397.50
$80.82	-11.6%	-$397.50
$101.02	+10.6%	+$502.50
$121.22	+32.7%	+$502.50
$141.42	+54.8%	+$502.50
$161.62	+76.9%	+$502.50
$181.82	+99.0%	+$502.50

When traders use collar on MDT

Collars on MDT hedge an existing long MDT 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.

MDT thesis for this collar

The market-implied 1-standard-deviation range for MDT extends from approximately $83.62 on the downside to $99.12 on the upside. A MDT collar hedges an existing long MDT 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 MDT IV rank near 71.97% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on MDT at 29.60%. As a Healthcare name, MDT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MDT-specific events.

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

Frequently asked questions

What is a collar on MDT?: A collar on MDT is the collar strategy applied to MDT (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 MDT stock at $91.37 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed MDT chain strike and the premiums come straight from that session's bid/ask midpoint.
How are MDT 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 MDT collar priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 29.60%), the computed maximum profit is $502.50 per contract and the computed maximum loss is -$397.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a MDT collar?: The breakeven for the MDT collar priced on this page is roughly $90.98 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 MDT market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.49%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on MDT?: Collars on MDT hedge an existing long MDT 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 MDT implied volatility affect this collar?: MDT ATM IV is at 29.60% with IV rank near 71.97%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.