RRC Collar Strategy
RRC (Range Resources Corporation), in the Energy sector, (Oil & Gas Exploration & Production industry), listed on NYSE.
Range Resources Corporation operates as an independent natural gas, natural gas liquids (NGLs), and oil company in the United States. The company engages in the exploration, development, and acquisition of natural gas and oil properties. As of December 31, 2021, the company owned and operated 1,350 net producing wells and approximately 794,000 net acres under lease located in the Appalachian region of the northeastern United States. It markets and sells natural gas and NGLs to utilities, marketing and midstream companies, and industrial users; petrochemical end users, marketers/traders, and natural gas processors; and oil and condensate to crude oil processors, transporters, and refining and marketing companies. The company was formerly known as Lomak Petroleum, Inc. and changed its name to Range Resources Corporation in 1998. Range Resources Corporation was founded in 1976 and is headquartered in Fort Worth, Texas.
RRC (Range Resources Corporation) trades in the Energy sector, specifically Oil & Gas Exploration & Production, with a market capitalization of approximately $9.72B, a trailing P/E of 10.74, a beta of 0.46 versus the broader market, a 52-week range of 32.6-48.31, average daily share volume of 3.6M, a public-listing history dating back to 1980, approximately 565 full-time employees. These structural characteristics shape how RRC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.46 indicates RRC 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 10.74 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. RRC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on RRC?
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 RRC snapshot
As of May 15, 2026, spot at $42.34, ATM IV 36.00%, IV rank 34.74%, expected move 10.32%. The collar on RRC 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 RRC specifically: IV regime affects collar pricing on both sides; mid-range RRC IV at 36.00% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 10.32% (roughly $4.37 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 RRC expiries trade a higher absolute premium for lower per-day decay. Position sizing on RRC should anchor to the underlying notional of $42.34 per share and to the trader's directional view on RRC stock.
RRC collar setup
The RRC 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 RRC near $42.34, 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 RRC 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 RRC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $42.34 | long |
| Sell 1 | Call | $44.00 | $1.15 |
| Buy 1 | Put | $40.00 | $0.80 |
RRC collar risk and reward
- Net Premium / Debit
- -$4,199.00
- Max Profit (per contract)
- $201.00
- Max Loss (per contract)
- -$199.00
- Breakeven(s)
- $41.99
- Risk / Reward Ratio
- 1.010
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.
RRC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on RRC. 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% | -$199.00 |
| $9.37 | -77.9% | -$199.00 |
| $18.73 | -55.8% | -$199.00 |
| $28.09 | -33.7% | -$199.00 |
| $37.45 | -11.5% | -$199.00 |
| $46.81 | +10.6% | +$201.00 |
| $56.17 | +32.7% | +$201.00 |
| $65.53 | +54.8% | +$201.00 |
| $74.89 | +76.9% | +$201.00 |
| $84.25 | +99.0% | +$201.00 |
When traders use collar on RRC
Collars on RRC hedge an existing long RRC 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.
RRC thesis for this collar
The market-implied 1-standard-deviation range for RRC extends from approximately $37.97 on the downside to $46.71 on the upside. A RRC collar hedges an existing long RRC 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 RRC IV rank near 34.74% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on RRC should anchor more to the directional view and the expected-move geometry. As a Energy name, RRC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to RRC-specific events.
RRC 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. RRC positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move RRC alongside the broader basket even when RRC-specific fundamentals are unchanged. Always rebuild the position from current RRC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on RRC?
- A collar on RRC is the collar strategy applied to RRC (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 RRC stock trading near $42.34, the strikes shown on this page are snapped to the nearest listed RRC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are RRC 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 RRC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 36.00%), the computed maximum profit is $201.00 per contract and the computed maximum loss is -$199.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a RRC collar?
- The breakeven for the RRC collar priced on this page is roughly $41.99 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 RRC market-implied 1-standard-deviation expected move is approximately 10.32%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on RRC?
- Collars on RRC hedge an existing long RRC 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 RRC implied volatility affect this collar?
- RRC ATM IV is at 36.00% with IV rank near 34.74%, 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.