NVMI Collar Strategy
NVMI (Nova Ltd.), in the Technology sector, (Semiconductors industry), listed on NASDAQ.
Nova Ltd. designs, develops, produces, and sells process control systems used in the manufacture of semiconductors in Israel, Taiwan, the United States, China, Korea, and internationally. Its product portfolio includes a set of metrology platforms for dimensional, films, and materials and chemical metrology measurements for process control for various semiconductor manufacturing process steps, including lithography, etch, chemical mechanical planarization, deposition, electrochemical plating, and advanced packaging. The company serves various sectors of the integrated circuit manufacturing industry, including logic, foundries, and memory manufacturers, as well as process equipment manufacturers. Nova Ltd. was formerly known as Nova Measuring Instruments Ltd. and changed its name to Nova Ltd. in July 2021. The company was incorporated in 1993 and is headquartered in Rehovot, Israel.
NVMI (Nova Ltd.) trades in the Technology sector, specifically Semiconductors, with a market capitalization of approximately $16.01B, a trailing P/E of 58.53, a beta of 1.78 versus the broader market, a 52-week range of 179-550, average daily share volume of 353K, a public-listing history dating back to 2000, approximately 1K full-time employees. These structural characteristics shape how NVMI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.78 indicates NVMI has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 58.53 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.
What is a collar on NVMI?
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 NVMI snapshot
As of May 15, 2026, spot at $515.84, ATM IV 58.00%, IV rank 21.58%, expected move 16.63%. The collar on NVMI 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 34-day expiry.
Why this collar structure on NVMI specifically: IV regime affects collar pricing on both sides; compressed NVMI IV at 58.00% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 16.63% (roughly $85.77 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated NVMI expiries trade a higher absolute premium for lower per-day decay. Position sizing on NVMI should anchor to the underlying notional of $515.84 per share and to the trader's directional view on NVMI stock.
NVMI collar setup
The NVMI 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 NVMI near $515.84, the first option leg uses a $540.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NVMI chain at a 34-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 NVMI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $515.84 | long |
| Sell 1 | Call | $540.00 | $27.25 |
| Buy 1 | Put | $490.00 | $23.25 |
NVMI collar risk and reward
- Net Premium / Debit
- -$51,184.00
- Max Profit (per contract)
- $2,816.00
- Max Loss (per contract)
- -$2,184.00
- Breakeven(s)
- $511.84
- Risk / Reward Ratio
- 1.289
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.
NVMI collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on NVMI. 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% | -$2,184.00 |
| $114.06 | -77.9% | -$2,184.00 |
| $228.12 | -55.8% | -$2,184.00 |
| $342.17 | -33.7% | -$2,184.00 |
| $456.23 | -11.6% | -$2,184.00 |
| $570.28 | +10.6% | +$2,816.00 |
| $684.33 | +32.7% | +$2,816.00 |
| $798.39 | +54.8% | +$2,816.00 |
| $912.44 | +76.9% | +$2,816.00 |
| $1,026.50 | +99.0% | +$2,816.00 |
When traders use collar on NVMI
Collars on NVMI hedge an existing long NVMI 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.
NVMI thesis for this collar
The market-implied 1-standard-deviation range for NVMI extends from approximately $430.07 on the downside to $601.61 on the upside. A NVMI collar hedges an existing long NVMI 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 NVMI IV rank near 21.58% 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 NVMI at 58.00%. As a Technology name, NVMI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NVMI-specific events.
NVMI 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. NVMI positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NVMI alongside the broader basket even when NVMI-specific fundamentals are unchanged. Always rebuild the position from current NVMI chain quotes before placing a trade.
Frequently asked questions
- What is a collar on NVMI?
- A collar on NVMI is the collar strategy applied to NVMI (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 NVMI stock trading near $515.84, the strikes shown on this page are snapped to the nearest listed NVMI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NVMI 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 NVMI collar priced from the end-of-day chain at a 30-day expiry (ATM IV 58.00%), the computed maximum profit is $2,816.00 per contract and the computed maximum loss is -$2,184.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a NVMI collar?
- The breakeven for the NVMI collar priced on this page is roughly $511.84 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 NVMI market-implied 1-standard-deviation expected move is approximately 16.63%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on NVMI?
- Collars on NVMI hedge an existing long NVMI 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 NVMI implied volatility affect this collar?
- NVMI ATM IV is at 58.00% with IV rank near 21.58%, 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.