How are ROST 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 ROST collar priced from the end-of-day chain at a 30-day expiry (ATM IV 38.17%), the computed maximum profit is $1,255.00 per contract and the computed maximum loss is -$1,245.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a ROST collar?

The breakeven for the ROST collar priced on this page is roughly $212.45 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 ROST market-implied 1-standard-deviation expected move is approximately 10.94%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current ROST implied volatility affect this collar?

ROST ATM IV is at 38.17% with IV rank near 99.86%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.

ROST Collar Strategy

ROST (Ross Stores, Inc.), in the Consumer Cyclical sector, (Apparel - Retail industry), listed on NASDAQ.

Ross Stores, Inc., together with its subsidiaries, operates off-price retail apparel and home fashion stores under the Ross Dress for Less and dd's DISCOUNTS brand names. Its stores primarily offer apparel, accessories, footwear, and home fashions. The company's Ross Dress for Less stores sell its products at department and specialty stores primarily to middle income households; and dd's DISCOUNTS stores sell its products at department and discount stores for households with moderate income. As of July 5, 2022, it operated approximately 1,950 stores under the Ross Dress for Less and dd's DISCOUNTS name in 40 states, the District of Columbia, and Guam. Ross Stores, Inc. was incorporated in 1957 and is headquartered in Dublin, California.

ROST (Ross Stores, Inc.) trades in the Consumer Cyclical sector, specifically Apparel - Retail, with a market capitalization of approximately $68.49B, a trailing P/E of 31.56, a beta of 0.88 versus the broader market, a 52-week range of 124.49-231.16, average daily share volume of 2.6M, a public-listing history dating back to 1985, approximately 107K full-time employees. These structural characteristics shape how ROST stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.88 places ROST roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. ROST pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a collar on ROST?

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 ROST snapshot

As of May 15, 2026, spot at $212.45, ATM IV 38.17%, IV rank 99.86%, expected move 10.94%. The collar on ROST 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 28-day expiry.

Why this collar structure on ROST specifically: IV regime affects collar pricing on both sides; elevated ROST IV at 38.17% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.94% (roughly $23.25 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ROST expiries trade a higher absolute premium for lower per-day decay. Position sizing on ROST should anchor to the underlying notional of $212.45 per share and to the trader's directional view on ROST stock.

ROST collar setup

The ROST 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 ROST near $212.45, the first option leg uses a $225.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ROST chain at a 28-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 ROST shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$212.45	long
Sell 1	Call	$225.00	$4.25
Buy 1	Put	$200.00	$4.25

ROST collar risk and reward

Net Premium / Debit: -$21,245.00
Max Profit (per contract): $1,255.00
Max Loss (per contract): -$1,245.00
Breakeven(s): $212.45
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.

ROST collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on ROST. 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%	-$1,245.00
$46.98	-77.9%	-$1,245.00
$93.96	-55.8%	-$1,245.00
$140.93	-33.7%	-$1,245.00
$187.90	-11.6%	-$1,245.00
$234.87	+10.6%	+$1,255.00
$281.85	+32.7%	+$1,255.00
$328.82	+54.8%	+$1,255.00
$375.79	+76.9%	+$1,255.00
$422.76	+99.0%	+$1,255.00

When traders use collar on ROST

Collars on ROST hedge an existing long ROST 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.

ROST thesis for this collar

The market-implied 1-standard-deviation range for ROST extends from approximately $189.20 on the downside to $235.70 on the upside. A ROST collar hedges an existing long ROST 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 ROST IV rank near 99.86% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on ROST at 38.17%. As a Consumer Cyclical name, ROST options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ROST-specific events.

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

Frequently asked questions

What is a collar on ROST?: A collar on ROST is the collar strategy applied to ROST (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 ROST stock trading near $212.45, the strikes shown on this page are snapped to the nearest listed ROST chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ROST 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 ROST collar priced from the end-of-day chain at a 30-day expiry (ATM IV 38.17%), the computed maximum profit is $1,255.00 per contract and the computed maximum loss is -$1,245.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a ROST collar?: The breakeven for the ROST collar priced on this page is roughly $212.45 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 ROST market-implied 1-standard-deviation expected move is approximately 10.94%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on ROST?: Collars on ROST hedge an existing long ROST 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 ROST implied volatility affect this collar?: ROST ATM IV is at 38.17% with IV rank near 99.86%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.