NXRT Collar Strategy
NXRT (NexPoint Residential Trust, Inc.), in the Real Estate sector, (REIT - Residential industry), listed on NYSE.
NexPoint Residential Trust is a publicly traded REIT, with its shares listed on the New York Stock Exchange under the symbol NXRT, primarily focused on acquiring, owning and operating well-located middle-income multifamily properties with value-add potential in large cities and suburban submarkets of large cities, primarily in the Southeastern and Southwestern United States. NXRT is externally advised by NexPoint Real Estate Advisors, L.P., an affiliate of NexPoint Advisors, L.P., an SEC-registered investment advisor, which has extensive real estate experience.
NXRT (NexPoint Residential Trust, Inc.) trades in the Real Estate sector, specifically REIT - Residential, with a market capitalization of approximately $740.0M, a beta of 1.22 versus the broader market, a 52-week range of 23.79-37.14, average daily share volume of 222K, a public-listing history dating back to 2015, approximately 2 full-time employees. These structural characteristics shape how NXRT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.22 places NXRT roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. NXRT pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on NXRT?
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 NXRT snapshot
As of May 15, 2026, spot at $28.10, ATM IV 7.20%, IV rank 0.00%, expected move 2.06%. The collar on NXRT 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 NXRT specifically: IV regime affects collar pricing on both sides; compressed NXRT IV at 7.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 2.06% (roughly $0.58 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 NXRT expiries trade a higher absolute premium for lower per-day decay. Position sizing on NXRT should anchor to the underlying notional of $28.10 per share and to the trader's directional view on NXRT stock.
NXRT collar setup
The NXRT 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 NXRT near $28.10, the first option leg uses a $29.51 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed NXRT 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 NXRT shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $28.10 | long |
| Sell 1 | Call | $29.51 | N/A |
| Buy 1 | Put | $26.70 | N/A |
NXRT 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.
NXRT collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on NXRT. 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 NXRT
Collars on NXRT hedge an existing long NXRT 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.
NXRT thesis for this collar
The market-implied 1-standard-deviation range for NXRT extends from approximately $27.52 on the downside to $28.68 on the upside. A NXRT collar hedges an existing long NXRT 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 NXRT IV rank near 0.00% 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 NXRT at 7.20%. As a Real Estate name, NXRT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to NXRT-specific events.
NXRT 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. NXRT positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move NXRT alongside the broader basket even when NXRT-specific fundamentals are unchanged. Always rebuild the position from current NXRT chain quotes before placing a trade.
Frequently asked questions
- What is a collar on NXRT?
- A collar on NXRT is the collar strategy applied to NXRT (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 NXRT stock trading near $28.10, the strikes shown on this page are snapped to the nearest listed NXRT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are NXRT 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 NXRT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 7.20%), 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 NXRT collar?
- The breakeven for the NXRT collar priced on this page is no defined breakeven on the modeled curve 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 NXRT market-implied 1-standard-deviation expected move is approximately 2.06%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on NXRT?
- Collars on NXRT hedge an existing long NXRT 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 NXRT implied volatility affect this collar?
- NXRT ATM IV is at 7.20% with IV rank near 0.00%, 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.