RDWR Collar Strategy
RDWR (Radware Ltd.), in the Technology sector, (Software - Infrastructure industry), listed on NASDAQ.
Radware Ltd., together with its subsidiaries, develops, manufactures, and markets cyber security and application delivery solutions for applications in cloud, physical, and software defined data centers worldwide. The company offers DefensePro, a real-time network attack mitigation device; AppWall, a Web application firewall; Radware Kubernetes WAF, a Web application firewall solution for CI/CD environments orchestrated by Kubernetes; and DefenseFlow, a cyber-command and control application. It also provides Alteon, an application delivery controller/load balancer for web, cloud, and mobile based applications; and LinkProof NG, a multi-homing and enterprise gateway solution for connectivity of enterprise and cloud-based applications. In addition, the company offers Security Updates Subscription, which provides protection from network elements, hosts and applications against the latest security vulnerabilities and threats; ERT Active Attackers Feed that provides customers with information pertaining to attack sources recently involved in DDoS attacks and web attacks; Alteon Global Elastic License that enables a high level of flexibility for ADC services across datacenters, private and public clouds; APSolute Vision, a network monitoring tool for cyber security and application delivery solutions; and MSSP Portal, a DDoS detection and mitigation service portal. Further, it provides Cloud DDoS Protection Service, which offers a range of enterprise-grade DDoS protection services in the cloud, as well as technical support, professional, managed, and training and certification services to its customers. The company sells its products primarily to independent distributors, including value added resellers, original equipment manufacturers, and system integrators.
RDWR (Radware Ltd.) trades in the Technology sector, specifically Software - Infrastructure, with a market capitalization of approximately $1.16B, a trailing P/E of 59.28, a beta of 0.82 versus the broader market, a 52-week range of 21.68-31.57, average daily share volume of 277K, a public-listing history dating back to 1999, approximately 1K full-time employees. These structural characteristics shape how RDWR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.82 places RDWR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 59.28 is on the rich side, which tends to correlate with higher earnings-window IV expansion as the market debates whether forward growth supports the multiple.
What is a collar on RDWR?
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 RDWR snapshot
As of May 15, 2026, spot at $27.98, ATM IV 44.30%, IV rank 34.03%, expected move 12.70%. The collar on RDWR 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 RDWR specifically: IV regime affects collar pricing on both sides; mid-range RDWR IV at 44.30% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 12.70% (roughly $3.55 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 RDWR expiries trade a higher absolute premium for lower per-day decay. Position sizing on RDWR should anchor to the underlying notional of $27.98 per share and to the trader's directional view on RDWR stock.
RDWR collar setup
The RDWR 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 RDWR near $27.98, the first option leg uses a $29.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed RDWR 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 RDWR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $27.98 | long |
| Sell 1 | Call | $29.00 | $1.23 |
| Buy 1 | Put | $27.00 | $1.05 |
RDWR collar risk and reward
- Net Premium / Debit
- -$2,780.50
- Max Profit (per contract)
- $119.50
- Max Loss (per contract)
- -$80.50
- Breakeven(s)
- $27.81
- Risk / Reward Ratio
- 1.484
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.
RDWR collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on RDWR. 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% | -$80.50 |
| $6.20 | -77.9% | -$80.50 |
| $12.38 | -55.8% | -$80.50 |
| $18.57 | -33.6% | -$80.50 |
| $24.75 | -11.5% | -$80.50 |
| $30.94 | +10.6% | +$119.50 |
| $37.12 | +32.7% | +$119.50 |
| $43.31 | +54.8% | +$119.50 |
| $49.49 | +76.9% | +$119.50 |
| $55.68 | +99.0% | +$119.50 |
When traders use collar on RDWR
Collars on RDWR hedge an existing long RDWR 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.
RDWR thesis for this collar
The market-implied 1-standard-deviation range for RDWR extends from approximately $24.43 on the downside to $31.53 on the upside. A RDWR collar hedges an existing long RDWR 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 RDWR IV rank near 34.03% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on RDWR should anchor more to the directional view and the expected-move geometry. As a Technology name, RDWR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RDWR-specific events.
RDWR 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. RDWR positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RDWR alongside the broader basket even when RDWR-specific fundamentals are unchanged. Always rebuild the position from current RDWR chain quotes before placing a trade.
Frequently asked questions
- What is a collar on RDWR?
- A collar on RDWR is the collar strategy applied to RDWR (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 RDWR stock trading near $27.98, the strikes shown on this page are snapped to the nearest listed RDWR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RDWR 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 RDWR collar priced from the end-of-day chain at a 30-day expiry (ATM IV 44.30%), the computed maximum profit is $119.50 per contract and the computed maximum loss is -$80.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RDWR collar?
- The breakeven for the RDWR collar priced on this page is roughly $27.81 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 RDWR market-implied 1-standard-deviation expected move is approximately 12.70%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on RDWR?
- Collars on RDWR hedge an existing long RDWR 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 RDWR implied volatility affect this collar?
- RDWR ATM IV is at 44.30% with IV rank near 34.03%, 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.