MFIC Collar Strategy
MFIC (MidCap Financial Investment Corporation), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
MidCap Financial Investment Corporation (MFIC) operates as an externally managed, non-diversified, closed-end investment fund, registered as a business development company (BDC) under the Investment Company Act of 1940. The firm specializes in providing private equity and debt capital to private middle-market companies, supporting initiatives such as leveraged buyouts, corporate acquisitions, recapitalizations, growth capital, and refinancing. MFIC offers a comprehensive range of financing instruments, including direct equity investments, preferred and common equity, warrants, and equity co-investments. Its debt solutions encompass mezzanine, first-lien secured, stretch senior, unitranche, second-lien secured, senior secured, unsecured, and subordinated loans. Beyond these core offerings, the fund also participates in Private Investments in Public Equity (PIPEs), acquires assets in the secondary market, and invests in structured products. While primarily focused on private ventures, MFIC may also allocate capital to thinly traded public company securities, cash equivalents, U.S. government debt, short-term high-quality debt, high-yield and distressed debt, and international investments, alongside collateralized loan obligations (CLOs) and credit-linked notes (CLNs).
MFIC (MidCap Financial Investment Corporation) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $794.9M, a beta of 0.67 versus the broader market, a 52-week range of 9.28-13.34, average daily share volume of 690K, a public-listing history dating back to 2004. These structural characteristics shape how MFIC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.67 indicates MFIC has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. MFIC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on MFIC?
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.
MFIC snapshot
As of August 14, 2026, spot at $9.77, ATM IV 21.00%, IV rank 4.11%, expected move 6.02%. The collar on MFIC below is built from the end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.
Why this collar structure on MFIC specifically: IV regime affects collar pricing on both sides; compressed MFIC IV at 21.00% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.02% (roughly $0.59 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MFIC expiries trade a higher absolute premium for lower per-day decay. Position sizing on MFIC should anchor to the underlying notional of $9.77 per share and to the trader's directional view on MFIC stock.
MFIC collar setup
The MFIC 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 MFIC at $9.77 on that close, the first option leg uses a $10.26 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MFIC chain at a 35-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 MFIC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $9.77 | long |
| Sell 1 | Call | $10.26 | N/A |
| Buy 1 | Put | $9.28 | N/A |
MFIC collar risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
MFIC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on MFIC. 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.
When traders use collar on MFIC
Collars on MFIC hedge an existing long MFIC 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.
MFIC thesis for this collar
The market-implied 1-standard-deviation range for MFIC extends from approximately $9.18 on the downside to $10.36 on the upside. A MFIC collar hedges an existing long MFIC 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 MFIC IV rank near 4.11% 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 MFIC at 21.00%. As a Financial Services name, MFIC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MFIC-specific events.
MFIC 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. MFIC positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MFIC alongside the broader basket even when MFIC-specific fundamentals are unchanged. Always rebuild the position from current MFIC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on MFIC?
- A collar on MFIC is the collar strategy applied to MFIC (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 MFIC stock at $9.77 on the most recent close, the strikes shown on this page are snapped to the nearest listed MFIC chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are MFIC 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 MFIC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 21.00%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MFIC collar?
- The breakeven for the MFIC collar priced on this page is no defined breakeven on the modeled curve at expiration, derived from the 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 MFIC market-implied 1-standard-deviation expected move in the same options snapshot is approximately 6.02%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on MFIC?
- Collars on MFIC hedge an existing long MFIC 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 MFIC implied volatility affect this collar?
- MFIC ATM IV is at 21.00% with IV rank near 4.11%, 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.