NKE Collar Strategy
NKE (NIKE, Inc.), in the Consumer Cyclical sector, (Apparel - Footwear & Accessories industry), listed on NYSE.
NIKE, Inc., together with its subsidiaries, designs, develops, markets, and sells men's, women's, and kids athletic footwear, apparel, equipment, and accessories worldwide. The company provides athletic and casual footwear, apparel, and accessories under the Jumpman trademark; and casual sneakers, apparel, and accessories under the Converse, Chuck Taylor, All Star, One Star, Star Chevron, and Jack Purcell trademarks. In addition, it sells a line of performance equipment and accessories comprising bags, socks, sport balls, eyewear, timepieces, digital devices, bats, gloves, protective equipment, and other equipment for sports activities under the NIKE brand; and various plastic products to other manufacturers. The company markets apparel with licensed college and professional team, and league logos, as well as sells sports apparel. Additionally, it licenses unaffiliated parties to manufacture and sell apparel, digital devices, and applications and other equipment for sports activities under NIKE-owned trademarks. The company sells its products to footwear stores; sporting goods stores; athletic specialty stores; department stores; skate, tennis, and golf shops; and other retail accounts through NIKE-owned retail stores, digital platforms, independent distributors, licensees, and sales representatives.
NKE (NIKE, Inc.) trades in the Consumer Cyclical sector, specifically Apparel - Footwear & Accessories, with a market capitalization of approximately $62.59B, a trailing P/E of 27.83, a beta of 1.12 versus the broader market, a 52-week range of 41.7-80.17, average daily share volume of 21.2M, a public-listing history dating back to 1980, approximately 79K full-time employees. These structural characteristics shape how NKE stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.12 places NKE roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. NKE pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on NKE?
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 NKE snapshot
As of May 15, 2026, spot at $42.02, ATM IV 36.99%, IV rank 43.35%, expected move 10.60%. The collar on NKE 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 28-day expiry.
Why this collar structure on NKE specifically: IV regime affects collar pricing on both sides; mid-range NKE IV at 36.99% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.60% (roughly $4.46 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 NKE expiries trade a higher absolute premium for lower per-day decay. Position sizing on NKE should anchor to the underlying notional of $42.02 per share and to the trader's directional view on NKE stock.
NKE collar setup
The NKE 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 NKE near $42.02, the first option leg uses a $44.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NKE 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 NKE shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $42.02 | long |
| Sell 1 | Call | $44.00 | $0.87 |
| Buy 1 | Put | $40.00 | $0.90 |
NKE collar risk and reward
- Net Premium / Debit
- -$4,204.50
- Max Profit (per contract)
- $195.50
- Max Loss (per contract)
- -$204.50
- Breakeven(s)
- $42.05
- Risk / Reward Ratio
- 0.956
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.
NKE collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on NKE. 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% | -$204.50 |
| $9.30 | -77.9% | -$204.50 |
| $18.59 | -55.8% | -$204.50 |
| $27.88 | -33.7% | -$204.50 |
| $37.17 | -11.5% | -$204.50 |
| $46.46 | +10.6% | +$195.50 |
| $55.75 | +32.7% | +$195.50 |
| $65.04 | +54.8% | +$195.50 |
| $74.33 | +76.9% | +$195.50 |
| $83.62 | +99.0% | +$195.50 |
When traders use collar on NKE
Collars on NKE hedge an existing long NKE 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.
NKE thesis for this collar
The market-implied 1-standard-deviation range for NKE extends from approximately $37.56 on the downside to $46.48 on the upside. A NKE collar hedges an existing long NKE 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 NKE IV rank near 43.35% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on NKE should anchor more to the directional view and the expected-move geometry. As a Consumer Cyclical name, NKE options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NKE-specific events.
NKE 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. NKE positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NKE alongside the broader basket even when NKE-specific fundamentals are unchanged. Always rebuild the position from current NKE chain quotes before placing a trade.
Frequently asked questions
- What is a collar on NKE?
- A collar on NKE is the collar strategy applied to NKE (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 NKE stock trading near $42.02, the strikes shown on this page are snapped to the nearest listed NKE chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NKE 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 NKE collar priced from the end-of-day chain at a 30-day expiry (ATM IV 36.99%), the computed maximum profit is $195.50 per contract and the computed maximum loss is -$204.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NKE collar?
- The breakeven for the NKE collar priced on this page is roughly $42.05 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 NKE market-implied 1-standard-deviation expected move is approximately 10.60%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on NKE?
- Collars on NKE hedge an existing long NKE 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 NKE implied volatility affect this collar?
- NKE ATM IV is at 36.99% with IV rank near 43.35%, 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.