How are TGT 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 TGT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 30.50%), the computed maximum profit is $674.00 per contract and the computed maximum loss is -$626.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a TGT collar?

The breakeven for the TGT collar priced on this page is roughly $130.26 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 TGT market-implied 1-standard-deviation expected move is approximately 8.74%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current TGT implied volatility affect this collar?

TGT ATM IV is at 30.50% with IV rank near 10.75%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

TGT Collar Strategy

TGT (Target Corporation), in the Consumer Defensive sector, (Discount Stores industry), listed on NYSE.

Target Corporation operates as a prominent general merchandise retailer throughout the United States. Its extensive product range includes a wide array of food items like perishables, dry groceries, dairy, and frozen goods, alongside apparel, accessories, home décor, electronics, toys, seasonal offerings, and essential beauty and household products. Beyond merchandise, Target stores often feature convenient in-store amenities such as Target Café, Target Optical, Starbucks outlets, and various other food service options. The company facilitates sales through its physical retail locations and its digital platform, Target.com. As of March 9, 2022, Target maintained a network of approximately 2,000 stores. Founded in 1902, the corporation's headquarters are situated in Minneapolis, Minnesota.

TGT (Target Corporation) trades in the Consumer Defensive sector, specifically Discount Stores, with a market capitalization of approximately $63.69B, a trailing P/E of 18.44, a beta of 0.99 versus the broader market, a 52-week range of 83.44-142.82, average daily share volume of 5.1M, a public-listing history dating back to 1967, approximately 440K full-time employees. These structural characteristics shape how TGT stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

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

What is a collar on TGT?

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 TGT snapshot

As of June 30, 2026, spot at $130.72, ATM IV 30.50%, IV rank 10.75%, expected move 8.74%. The collar on TGT 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 31-day expiry.

Why this collar structure on TGT specifically: IV regime affects collar pricing on both sides; compressed TGT IV at 30.50% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 8.74% (roughly $11.43 on the underlying). The 31-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated TGT expiries trade a higher absolute premium for lower per-day decay. Position sizing on TGT should anchor to the underlying notional of $130.72 per share and to the trader's directional view on TGT stock.

TGT collar setup

The TGT 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 TGT near $130.72, the first option leg uses a $137.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TGT chain at a 31-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 TGT shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$130.72	long
Sell 1	Call	$137.00	$2.34
Buy 1	Put	$124.00	$1.88

TGT collar risk and reward

Net Premium / Debit: -$13,026.00
Max Profit (per contract): $674.00
Max Loss (per contract): -$626.00
Breakeven(s): $130.26
Risk / Reward Ratio: 1.077

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.

TGT collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on TGT. 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%	-$626.00
$28.91	-77.9%	-$626.00
$57.81	-55.8%	-$626.00
$86.72	-33.7%	-$626.00
$115.62	-11.6%	-$626.00
$144.52	+10.6%	+$674.00
$173.42	+32.7%	+$674.00
$202.32	+54.8%	+$674.00
$231.22	+76.9%	+$674.00
$260.13	+99.0%	+$674.00

When traders use collar on TGT

Collars on TGT hedge an existing long TGT 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.

TGT thesis for this collar

The market-implied 1-standard-deviation range for TGT extends from approximately $119.29 on the downside to $142.15 on the upside. A TGT collar hedges an existing long TGT 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 TGT IV rank near 10.75% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on TGT at 30.50%. As a Consumer Defensive name, TGT options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TGT-specific events.

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

Frequently asked questions

What is a collar on TGT?: A collar on TGT is the collar strategy applied to TGT (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 TGT stock trading near $130.72, the strikes shown on this page are snapped to the nearest listed TGT chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are TGT 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 TGT collar priced from the end-of-day chain at a 30-day expiry (ATM IV 30.50%), the computed maximum profit is $674.00 per contract and the computed maximum loss is -$626.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a TGT collar?: The breakeven for the TGT collar priced on this page is roughly $130.26 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 TGT market-implied 1-standard-deviation expected move is approximately 8.74%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on TGT?: Collars on TGT hedge an existing long TGT 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 TGT implied volatility affect this collar?: TGT ATM IV is at 30.50% with IV rank near 10.75%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.