NOV Collar Strategy
NOV (NOV Inc.), in the Energy sector, (Oil & Gas Equipment & Services industry), listed on NYSE.
NOV Inc. designs, constructs, manufactures, and sells systems, components, and products for oil and gas drilling and production, and industrial and renewable energy sectors worldwide. The company operates through three segments: Wellbore Technologies, Completion & Production Solutions, and Rig Technologies. It also provides solids control and waste management equipment and services; portable power generation products; drill and wired pipes; drilling optimization and automation services; tubular inspection, repair, and coating services; instrumentation; measuring and monitoring services; downhole and fishing tools; steerable technologies; and drill bits. The company offers equipment and technologies for hydraulic fracture stimulation, including downhole multistage fracturing tools, pressure pumping trucks, blenders, sanders, hydration and injection units, flowline, and manifolds; coiled tubing units, and wireline units and tools; connections and liner hangers; onshore production consists of composite pipe, surface transfer and progressive cavity pumps, and artificial lift systems; and offshore production, such as floating production systems and subsea production technologies, as well as manufactures industrial pumps and mixers. It also provides substructures, derricks, and masts; cranes; jacking systems; pipe lifting, racking, rotating, and assembly systems; mud pumps; pressure control equipment; drives and generators; rig instrumentation and control systems; mooring, anchor, and deck handling machinery; equipment components for offshore wind construction vessels; and pipelay and construction systems. NOV Inc. offers spare parts, repair, and rentals as well as comprehensive remote equipment monitoring, technical support, field service, and customer training.
NOV (NOV Inc.) trades in the Energy sector, specifically Oil & Gas Equipment & Services, with a market capitalization of approximately $7.35B, a trailing P/E of 80.40, a beta of 0.92 versus the broader market, a 52-week range of 11.65-20.93, average daily share volume of 5.0M, a public-listing history dating back to 1996, approximately 34K full-time employees. These structural characteristics shape how NOV stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.92 places NOV roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 80.40 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. NOV pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on NOV?
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 NOV snapshot
As of May 15, 2026, spot at $20.34, ATM IV 36.90%, IV rank 31.62%, expected move 10.58%. The collar on NOV 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 98-day expiry.
Why this collar structure on NOV specifically: IV regime affects collar pricing on both sides; mid-range NOV IV at 36.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.58% (roughly $2.15 on the underlying). The 98-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated NOV expiries trade a higher absolute premium for lower per-day decay. Position sizing on NOV should anchor to the underlying notional of $20.34 per share and to the trader's directional view on NOV stock.
NOV collar setup
The NOV 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 NOV near $20.34, the first option leg uses a $21.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NOV chain at a 98-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 NOV shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $20.34 | long |
| Sell 1 | Call | $21.00 | $1.40 |
| Buy 1 | Put | $19.00 | $1.00 |
NOV collar risk and reward
- Net Premium / Debit
- -$1,994.00
- Max Profit (per contract)
- $106.00
- Max Loss (per contract)
- -$94.00
- Breakeven(s)
- $19.94
- Risk / Reward Ratio
- 1.128
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.
NOV collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on NOV. 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% | -$94.00 |
| $4.51 | -77.8% | -$94.00 |
| $9.00 | -55.7% | -$94.00 |
| $13.50 | -33.6% | -$94.00 |
| $17.99 | -11.5% | -$94.00 |
| $22.49 | +10.6% | +$106.00 |
| $26.99 | +32.7% | +$106.00 |
| $31.48 | +54.8% | +$106.00 |
| $35.98 | +76.9% | +$106.00 |
| $40.48 | +99.0% | +$106.00 |
When traders use collar on NOV
Collars on NOV hedge an existing long NOV 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.
NOV thesis for this collar
The market-implied 1-standard-deviation range for NOV extends from approximately $18.19 on the downside to $22.49 on the upside. A NOV collar hedges an existing long NOV 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 NOV IV rank near 31.62% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on NOV should anchor more to the directional view and the expected-move geometry. As a Energy name, NOV options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NOV-specific events.
NOV 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. NOV positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NOV alongside the broader basket even when NOV-specific fundamentals are unchanged. Always rebuild the position from current NOV chain quotes before placing a trade.
Frequently asked questions
- What is a collar on NOV?
- A collar on NOV is the collar strategy applied to NOV (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 NOV stock trading near $20.34, the strikes shown on this page are snapped to the nearest listed NOV chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NOV 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 NOV collar priced from the end-of-day chain at a 30-day expiry (ATM IV 36.90%), the computed maximum profit is $106.00 per contract and the computed maximum loss is -$94.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NOV collar?
- The breakeven for the NOV collar priced on this page is roughly $19.94 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 NOV market-implied 1-standard-deviation expected move is approximately 10.58%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on NOV?
- Collars on NOV hedge an existing long NOV 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 NOV implied volatility affect this collar?
- NOV ATM IV is at 36.90% with IV rank near 31.62%, 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.