PBF Collar Strategy
PBF (PBF Energy Inc.), in the Energy sector, (Oil & Gas Refining & Marketing industry), listed on NYSE.
PBF Energy Inc., together with its subsidiaries, engages in refining and supplying petroleum products. The company operates in two segments, Refining and Logistics. It produces gasoline, ultra-low-sulfur diesel, heating oil, diesel fuel, jet fuel, lubricants, petrochemicals, and asphalt, as well as unbranded transportation fuels, petrochemical feedstocks, blending components, and other petroleum products. The company sells its products in Northeast, Midwest, Gulf Coast, and West Coast of the United States, as well as in other regions of the United States, Canada, and Mexico. It also offers various rail, truck, and marine terminaling services, as well as pipeline transportation and storage services. As of December 31, 2021, the company owned and operated six oil refineries and related assets.
PBF (PBF Energy Inc.) trades in the Energy sector, specifically Oil & Gas Refining & Marketing, with a market capitalization of approximately $4.84B, a trailing P/E of 10.86, a beta of 0.14 versus the broader market, a 52-week range of 17.53-52.18, average daily share volume of 3.8M, a public-listing history dating back to 2012, approximately 4K full-time employees. These structural characteristics shape how PBF stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.14 indicates PBF has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. The trailing P/E of 10.86 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. PBF pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on PBF?
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 PBF snapshot
As of May 15, 2026, spot at $42.27, ATM IV 67.60%, IV rank 30.96%, expected move 19.38%. The collar on PBF 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 PBF specifically: IV regime affects collar pricing on both sides; mid-range PBF IV at 67.60% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 19.38% (roughly $8.19 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 PBF expiries trade a higher absolute premium for lower per-day decay. Position sizing on PBF should anchor to the underlying notional of $42.27 per share and to the trader's directional view on PBF stock.
PBF collar setup
The PBF 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 PBF near $42.27, the first option leg uses a $44.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PBF 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 PBF shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $42.27 | long |
| Sell 1 | Call | $44.00 | $2.88 |
| Buy 1 | Put | $40.00 | $2.45 |
PBF collar risk and reward
- Net Premium / Debit
- -$4,184.50
- Max Profit (per contract)
- $215.50
- Max Loss (per contract)
- -$184.50
- Breakeven(s)
- $41.85
- Risk / Reward Ratio
- 1.168
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.
PBF collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on PBF. 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% | -$184.50 |
| $9.36 | -77.9% | -$184.50 |
| $18.70 | -55.8% | -$184.50 |
| $28.05 | -33.7% | -$184.50 |
| $37.39 | -11.5% | -$184.50 |
| $46.74 | +10.6% | +$215.50 |
| $56.08 | +32.7% | +$215.50 |
| $65.43 | +54.8% | +$215.50 |
| $74.77 | +76.9% | +$215.50 |
| $84.12 | +99.0% | +$215.50 |
When traders use collar on PBF
Collars on PBF hedge an existing long PBF 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.
PBF thesis for this collar
The market-implied 1-standard-deviation range for PBF extends from approximately $34.08 on the downside to $50.46 on the upside. A PBF collar hedges an existing long PBF 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 PBF IV rank near 30.96% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on PBF should anchor more to the directional view and the expected-move geometry. As a Energy name, PBF options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PBF-specific events.
PBF 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. PBF positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PBF alongside the broader basket even when PBF-specific fundamentals are unchanged. Always rebuild the position from current PBF chain quotes before placing a trade.
Frequently asked questions
- What is a collar on PBF?
- A collar on PBF is the collar strategy applied to PBF (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 PBF stock trading near $42.27, the strikes shown on this page are snapped to the nearest listed PBF chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PBF 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 PBF collar priced from the end-of-day chain at a 30-day expiry (ATM IV 67.60%), the computed maximum profit is $215.50 per contract and the computed maximum loss is -$184.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PBF collar?
- The breakeven for the PBF collar priced on this page is roughly $41.85 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 PBF market-implied 1-standard-deviation expected move is approximately 19.38%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on PBF?
- Collars on PBF hedge an existing long PBF 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 PBF implied volatility affect this collar?
- PBF ATM IV is at 67.60% with IV rank near 30.96%, 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.