PBA Collar Strategy
PBA (Pembina Pipeline Corporation), in the Energy sector, (Oil & Gas Midstream industry), listed on NYSE.
Pembina Pipeline Corporation provides transportation and midstream services for the energy industry. It operates through three segments: Pipelines, Facilities, and Marketing & New Ventures. The Pipelines segment operates conventional, oil sands and heavy oil, and transmission assets with a transportation capacity of 3.1 millions of barrels of oil equivalent per day, ground storage of 11 millions of barrels, and rail terminalling capacity of approximately 105 thousands of barrels of oil equivalent per day serving markets and basins across North America. The Facilities segment offers infrastructure that provides customers with natural gas, condensate, and natural gas liquids (NGLs), including ethane, propane, butane, and condensate; and includes 354 thousands of barrels per day of NGL fractionation capacity, 21 millions of barrels of cavern storage capacity, and associated pipeline and rail terminalling facilities. The Marketing & New Ventures segment buys and sells hydrocarbon liquids and natural gas originating in the Western Canadian sedimentary basin and other basins. Pembina Pipeline Corporation was incorporated in 1954 and is headquartered in Calgary, Canada.
PBA (Pembina Pipeline Corporation) trades in the Energy sector, specifically Oil & Gas Midstream, with a market capitalization of approximately $27.45B, a trailing P/E of 22.25, a beta of 0.70 versus the broader market, a 52-week range of 35.45-47.26, average daily share volume of 1.4M, a public-listing history dating back to 2010, approximately 3K full-time employees. These structural characteristics shape how PBA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.70 places PBA roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PBA pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on PBA?
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 PBA snapshot
As of May 15, 2026, spot at $48.91, ATM IV 19.20%, IV rank 2.56%, expected move 5.50%. The collar on PBA 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 PBA specifically: IV regime affects collar pricing on both sides; compressed PBA IV at 19.20% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 5.50% (roughly $2.69 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 PBA expiries trade a higher absolute premium for lower per-day decay. Position sizing on PBA should anchor to the underlying notional of $48.91 per share and to the trader's directional view on PBA stock.
PBA collar setup
The PBA 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 PBA near $48.91, the first option leg uses a $51.36 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PBA 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 PBA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $48.91 | long |
| Sell 1 | Call | $51.36 | N/A |
| Buy 1 | Put | $46.46 | N/A |
PBA 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.
PBA collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on PBA. 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 PBA
Collars on PBA hedge an existing long PBA 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.
PBA thesis for this collar
The market-implied 1-standard-deviation range for PBA extends from approximately $46.22 on the downside to $51.60 on the upside. A PBA collar hedges an existing long PBA 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 PBA IV rank near 2.56% 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 PBA at 19.20%. As a Energy name, PBA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PBA-specific events.
PBA 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. PBA positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PBA alongside the broader basket even when PBA-specific fundamentals are unchanged. Always rebuild the position from current PBA chain quotes before placing a trade.
Frequently asked questions
- What is a collar on PBA?
- A collar on PBA is the collar strategy applied to PBA (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 PBA stock trading near $48.91, the strikes shown on this page are snapped to the nearest listed PBA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PBA 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 PBA collar priced from the end-of-day chain at a 30-day expiry (ATM IV 19.20%), 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 PBA collar?
- The breakeven for the PBA 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 PBA market-implied 1-standard-deviation expected move is approximately 5.50%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on PBA?
- Collars on PBA hedge an existing long PBA 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 PBA implied volatility affect this collar?
- PBA ATM IV is at 19.20% with IV rank near 2.56%, 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.