PAX Collar Strategy
PAX (Patria Investments Ltd), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.
Patria Investments Limited operates as a private market investment firm. It specializes in investments in private equity, secondary direct and indirect and venture capital with focus in middle market, buyout and growth capital investments. It seeks to be sector agnostic with focus on agribusiness, power & energy, healthcare, logistics & transportations, food & beverage, agricultural products, packaged foods and meats, education services, outsourced business services, and digital & tech services. It prefers to invest globally with focus on Latin America, Europe, United States, North America and Brazil. It seeks to invest between $38.48 million and $72.14 million per transaction. The firm seeks a majority or minority stake in its portfolio companies.
PAX (Patria Investments Ltd) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $1.75B, a trailing P/E of 24.23, a beta of 0.74 versus the broader market, a 52-week range of 10.72-17.8, average daily share volume of 954K, a public-listing history dating back to 2021, approximately 494 full-time employees. These structural characteristics shape how PAX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.74 places PAX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PAX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on PAX?
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 PAX snapshot
As of June 29, 2026, spot at $10.73, ATM IV 307.50%, IV rank 63.63%, expected move 88.16%. The collar on PAX 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 18-day expiry.
Why this collar structure on PAX specifically: IV regime affects collar pricing on both sides; mid-range PAX IV at 307.50% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 88.16% (roughly $9.46 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PAX expiries trade a higher absolute premium for lower per-day decay. Position sizing on PAX should anchor to the underlying notional of $10.73 per share and to the trader's directional view on PAX stock.
PAX collar setup
The PAX 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 PAX near $10.73, the first option leg uses a $11.27 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PAX chain at a 18-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 PAX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $10.73 | long |
| Sell 1 | Call | $11.27 | N/A |
| Buy 1 | Put | $10.19 | N/A |
PAX 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.
PAX collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on PAX. 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 PAX
Collars on PAX hedge an existing long PAX 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.
PAX thesis for this collar
The market-implied 1-standard-deviation range for PAX extends from approximately $1.27 on the downside to $20.19 on the upside. A PAX collar hedges an existing long PAX 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 PAX IV rank near 63.63% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on PAX should anchor more to the directional view and the expected-move geometry. As a Financial Services name, PAX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PAX-specific events.
PAX 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. PAX positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PAX alongside the broader basket even when PAX-specific fundamentals are unchanged. Always rebuild the position from current PAX chain quotes before placing a trade.
Frequently asked questions
- What is a collar on PAX?
- A collar on PAX is the collar strategy applied to PAX (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 PAX stock trading near $10.73, the strikes shown on this page are snapped to the nearest listed PAX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PAX 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 PAX collar priced from the end-of-day chain at a 30-day expiry (ATM IV 307.50%), 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 PAX collar?
- The breakeven for the PAX 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 PAX market-implied 1-standard-deviation expected move is approximately 88.16%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on PAX?
- Collars on PAX hedge an existing long PAX 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 PAX implied volatility affect this collar?
- PAX ATM IV is at 307.50% with IV rank near 63.63%, 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.