OTTR Collar Strategy
OTTR (Otter Tail Corporation), in the Industrials sector, (Conglomerates industry), listed on NASDAQ.
Otter Tail Corporation, an entity founded in 1907 and based in Fergus Falls, Minnesota, is a diversified enterprise conducting business in the United States across three primary sectors: an electric utility, manufacturing operations, and the production of plastic pipes. The company adopted its current name in 2001, having previously been known as Otter Tail Power Company. The Electric segment is responsible for generating, transmitting, distributing, and selling electricity. It serves approximately 133,000 residential, industrial, and commercial customers across Minnesota, North Dakota, and South Dakota. This segment draws its power from a mix of sources including coal, wind, hydroelectric, and natural gas, and actively participates in the Midcontinent Independent System Operator, Inc. (MISO) markets. Through its Manufacturing segment, the company offers services such as contract machining, metal parts stamping, fabrication, and painting.
OTTR (Otter Tail Corporation) trades in the Industrials sector, specifically Conglomerates, with a market capitalization of approximately $3.90B, a trailing P/E of 19.96, a beta of 0.43 versus the broader market, a 52-week range of 74.15-95.09, average daily share volume of 266K, a public-listing history dating back to 1990, approximately 2K full-time employees. These structural characteristics shape how OTTR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.43 indicates OTTR has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. OTTR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on OTTR?
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.
OTTR snapshot
As of August 14, 2026, spot at $93.21, ATM IV 287.70%, IV rank 57.12%, expected move 5.00%. The collar on OTTR 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 OTTR specifically: IV regime affects collar pricing on both sides; mid-range OTTR IV at 287.70% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.00% (roughly $4.66 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 OTTR expiries trade a higher absolute premium for lower per-day decay. Position sizing on OTTR should anchor to the underlying notional of $93.21 per share and to the trader's directional view on OTTR stock.
OTTR collar setup
The OTTR 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 OTTR at $93.21 on that close, the first option leg uses a $97.87 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed OTTR 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 OTTR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $93.21 | long |
| Sell 1 | Call | $97.87 | N/A |
| Buy 1 | Put | $88.55 | N/A |
OTTR 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.
OTTR collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on OTTR. 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 OTTR
Collars on OTTR hedge an existing long OTTR 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.
OTTR thesis for this collar
The market-implied 1-standard-deviation range for OTTR extends from approximately $88.55 on the downside to $97.87 on the upside. A OTTR collar hedges an existing long OTTR 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 OTTR IV rank near 57.12% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on OTTR should anchor more to the directional view and the expected-move geometry. As a Industrials name, OTTR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to OTTR-specific events.
OTTR 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. OTTR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move OTTR alongside the broader basket even when OTTR-specific fundamentals are unchanged. Always rebuild the position from current OTTR chain quotes before placing a trade.
Frequently asked questions
- What is a collar on OTTR?
- A collar on OTTR is the collar strategy applied to OTTR (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 OTTR stock at $93.21 on the most recent close, the strikes shown on this page are snapped to the nearest listed OTTR chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are OTTR 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 OTTR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 287.70%), 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 OTTR collar?
- The breakeven for the OTTR 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 OTTR market-implied 1-standard-deviation expected move in the same options snapshot is approximately 5.00%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on OTTR?
- Collars on OTTR hedge an existing long OTTR 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 OTTR implied volatility affect this collar?
- OTTR ATM IV is at 287.70% with IV rank near 57.12%, 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.