How are PCAR 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 PCAR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 27.80%), the computed maximum profit is $502.00 per contract and the computed maximum loss is -$498.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PCAR collar?

The breakeven for the PCAR collar priced on this page is roughly $119.98 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 PCAR market-implied 1-standard-deviation expected move is approximately 7.97%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PCAR implied volatility affect this collar?

PCAR ATM IV is at 27.80% with IV rank near 42.06%, 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.

PCAR Collar Strategy

PCAR (PACCAR Inc), in the Industrials sector, (Industrial - Machinery industry), listed on NASDAQ.

PACCAR Inc is a global leader specializing in the design, production, and distribution of commercial trucks, covering light, medium, and heavy-duty classes. Its market reach extends across the United States, Europe, Mexico, South America, Australia, and other international territories. The company's operations are divided into three principal segments: Truck, Parts, and Financial Services. The Truck division focuses on engineering, manufacturing, and supplying vehicles tailored for both long-distance highway travel and challenging off-highway applications, primarily for hauling commercial and consumer goods. These vehicles are sold worldwide through an expansive network of independent dealerships, prominently featuring the Kenworth, Peterbilt, and DAF brands. The Parts segment is dedicated to supplying aftermarket components for its trucks and associated commercial vehicles.

PCAR (PACCAR Inc) trades in the Industrials sector, specifically Industrial - Machinery, with a market capitalization of approximately $63.51B, a trailing P/E of 25.67, a beta of 0.99 versus the broader market, a 52-week range of 92.25-131.88, average daily share volume of 3.0M, a public-listing history dating back to 1980, approximately 30K full-time employees. These structural characteristics shape how PCAR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.99 places PCAR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PCAR pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on PCAR?

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 PCAR snapshot

As of June 30, 2026, spot at $120.38, ATM IV 27.80%, IV rank 42.06%, expected move 7.97%. The collar on PCAR 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 17-day expiry.

Why this collar structure on PCAR specifically: IV regime affects collar pricing on both sides; mid-range PCAR IV at 27.80% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.97% (roughly $9.59 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated PCAR expiries trade a higher absolute premium for lower per-day decay. Position sizing on PCAR should anchor to the underlying notional of $120.38 per share and to the trader's directional view on PCAR stock.

PCAR collar setup

The PCAR 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 PCAR near $120.38, the first option leg uses a $125.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PCAR chain at a 17-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 PCAR shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$120.38	long
Sell 1	Call	$125.00	$1.25
Buy 1	Put	$115.00	$0.85

PCAR collar risk and reward

Net Premium / Debit: -$11,998.00
Max Profit (per contract): $502.00
Max Loss (per contract): -$498.00
Breakeven(s): $119.98
Risk / Reward Ratio: 1.008

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.

PCAR collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on PCAR. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	-$498.00
$26.63	-77.9%	-$498.00
$53.24	-55.8%	-$498.00
$79.86	-33.7%	-$498.00
$106.47	-11.6%	-$498.00
$133.09	+10.6%	+$502.00
$159.70	+32.7%	+$502.00
$186.32	+54.8%	+$502.00
$212.93	+76.9%	+$502.00
$239.55	+99.0%	+$502.00

When traders use collar on PCAR

Collars on PCAR hedge an existing long PCAR 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.

PCAR thesis for this collar

The market-implied 1-standard-deviation range for PCAR extends from approximately $110.79 on the downside to $129.97 on the upside. A PCAR collar hedges an existing long PCAR 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 PCAR IV rank near 42.06% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on PCAR should anchor more to the directional view and the expected-move geometry. As a Industrials name, PCAR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PCAR-specific events.

PCAR 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. PCAR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PCAR alongside the broader basket even when PCAR-specific fundamentals are unchanged. Always rebuild the position from current PCAR chain quotes before placing a trade.

Frequently asked questions

What is a collar on PCAR?: A collar on PCAR is the collar strategy applied to PCAR (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 PCAR stock trading near $120.38, the strikes shown on this page are snapped to the nearest listed PCAR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are PCAR 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 PCAR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 27.80%), the computed maximum profit is $502.00 per contract and the computed maximum loss is -$498.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PCAR collar?: The breakeven for the PCAR collar priced on this page is roughly $119.98 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 PCAR market-implied 1-standard-deviation expected move is approximately 7.97%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on PCAR?: Collars on PCAR hedge an existing long PCAR 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 PCAR implied volatility affect this collar?: PCAR ATM IV is at 27.80% with IV rank near 42.06%, 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.