STNG Collar Strategy
STNG (Scorpio Tankers Inc.), in the Energy sector, (Oil & Gas Midstream industry), listed on NYSE.
Scorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of refined petroleum products in the shipping markets worldwide. As of March 18, 2022, the company's fleet consisted of 124 owned, finance leased, or bareboat chartered-in tankers, including 42 LR2, 6 LR1, 62 MR, and 14 Handymax with a weighted average age of approximately 6.2 years. Scorpio Tankers Inc. was incorporated in 2009 and is based in Monaco.
STNG (Scorpio Tankers Inc.) trades in the Energy sector, specifically Oil & Gas Midstream, with a market capitalization of approximately $4.25B, a trailing P/E of 7.72, a beta of -0.25 versus the broader market, a 52-week range of 37.96-87.39, average daily share volume of 1.3M, a public-listing history dating back to 2010, approximately 24 full-time employees. These structural characteristics shape how STNG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of -0.25 indicates STNG 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 7.72 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. STNG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on STNG?
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 STNG snapshot
As of May 15, 2026, spot at $82.28, ATM IV 43.50%, IV rank 42.62%, expected move 12.47%. The collar on STNG 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 STNG specifically: IV regime affects collar pricing on both sides; mid-range STNG IV at 43.50% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 12.47% (roughly $10.26 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 STNG expiries trade a higher absolute premium for lower per-day decay. Position sizing on STNG should anchor to the underlying notional of $82.28 per share and to the trader's directional view on STNG stock.
STNG collar setup
The STNG 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 STNG near $82.28, the first option leg uses a $87.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed STNG 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 STNG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $82.28 | long |
| Sell 1 | Call | $87.50 | $2.10 |
| Buy 1 | Put | $77.50 | $2.38 |
STNG collar risk and reward
- Net Premium / Debit
- -$8,255.50
- Max Profit (per contract)
- $494.50
- Max Loss (per contract)
- -$505.50
- Breakeven(s)
- $82.55
- Risk / Reward Ratio
- 0.978
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.
STNG collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on STNG. 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% | -$505.50 |
| $18.20 | -77.9% | -$505.50 |
| $36.39 | -55.8% | -$505.50 |
| $54.58 | -33.7% | -$505.50 |
| $72.78 | -11.6% | -$505.50 |
| $90.97 | +10.6% | +$494.50 |
| $109.16 | +32.7% | +$494.50 |
| $127.35 | +54.8% | +$494.50 |
| $145.54 | +76.9% | +$494.50 |
| $163.73 | +99.0% | +$494.50 |
When traders use collar on STNG
Collars on STNG hedge an existing long STNG 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.
STNG thesis for this collar
The market-implied 1-standard-deviation range for STNG extends from approximately $72.02 on the downside to $92.54 on the upside. A STNG collar hedges an existing long STNG 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 STNG IV rank near 42.62% is mid-range against its 1-year distribution, so the IV signal is neutral; the collar thesis on STNG should anchor more to the directional view and the expected-move geometry. As a Energy name, STNG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to STNG-specific events.
STNG 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. STNG positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move STNG alongside the broader basket even when STNG-specific fundamentals are unchanged. Always rebuild the position from current STNG chain quotes before placing a trade.
Frequently asked questions
- What is a collar on STNG?
- A collar on STNG is the collar strategy applied to STNG (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 STNG stock trading near $82.28, the strikes shown on this page are snapped to the nearest listed STNG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are STNG 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 STNG collar priced from the end-of-day chain at a 30-day expiry (ATM IV 43.50%), the computed maximum profit is $494.50 per contract and the computed maximum loss is -$505.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a STNG collar?
- The breakeven for the STNG collar priced on this page is roughly $82.55 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 STNG market-implied 1-standard-deviation expected move is approximately 12.47%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on STNG?
- Collars on STNG hedge an existing long STNG 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 STNG implied volatility affect this collar?
- STNG ATM IV is at 43.50% with IV rank near 42.62%, 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.