TMC Collar Strategy
TMC (TMC the metals company Inc.), in the Basic Materials sector, (Industrial Materials industry), listed on NASDAQ.
TMC the metals company Inc., a deep-sea minerals exploration company, focuses on the collection, processing, and refining of polymetallic nodules found on the seafloor in the Clarion Clipperton Zone (CCZ) in the south-west of San Diego, California. The company primarily explores for nickel, cobalt, copper, and manganese products. TMC the metals company Inc., through its subsidiaries, holds exploration rights in three polymetallic nodule contract areas in the CCZ of the Pacific Ocean. Its products are used in electric vehicles (EV), renewable energy storage markets, EV wiring, clean energy transmission, manganese alloy production required for steel production, and other applications. The company was formerly known as Sustainable Opportunities Acquisition Corporation and changed its name to TMC the metals company Inc. TMC the metals company Inc. was incorporated in 2019 and is based in Vancouver, Canada.
TMC (TMC the metals company Inc.) trades in the Basic Materials sector, specifically Industrial Materials, with a market capitalization of approximately $2.44B, a beta of 1.97 versus the broader market, a 52-week range of 3-11.35, average daily share volume of 5.5M, a public-listing history dating back to 2021, approximately 47 full-time employees. These structural characteristics shape how TMC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.97 indicates TMC has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a collar on TMC?
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 TMC snapshot
As of May 15, 2026, spot at $5.45, ATM IV 86.32%, IV rank 0.00%, expected move 24.75%. The collar on TMC 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 TMC specifically: IV regime affects collar pricing on both sides; compressed TMC IV at 86.32% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 24.75% (roughly $1.35 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 TMC expiries trade a higher absolute premium for lower per-day decay. Position sizing on TMC should anchor to the underlying notional of $5.45 per share and to the trader's directional view on TMC stock.
TMC collar setup
The TMC 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 TMC near $5.45, the first option leg uses a $5.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed TMC 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 TMC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $5.45 | long |
| Sell 1 | Call | $5.50 | $0.51 |
| Buy 1 | Put | $5.00 | $0.29 |
TMC collar risk and reward
- Net Premium / Debit
- -$523.50
- Max Profit (per contract)
- $26.50
- Max Loss (per contract)
- -$23.50
- Breakeven(s)
- $5.24
- Risk / Reward Ratio
- 1.128
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.
TMC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on TMC. 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 | -99.8% | -$23.50 |
| $1.21 | -77.7% | -$23.50 |
| $2.42 | -55.6% | -$23.50 |
| $3.62 | -33.5% | -$23.50 |
| $4.83 | -11.5% | -$23.50 |
| $6.03 | +10.6% | +$26.50 |
| $7.23 | +32.7% | +$26.50 |
| $8.44 | +54.8% | +$26.50 |
| $9.64 | +76.9% | +$26.50 |
| $10.85 | +99.0% | +$26.50 |
When traders use collar on TMC
Collars on TMC hedge an existing long TMC 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.
TMC thesis for this collar
The market-implied 1-standard-deviation range for TMC extends from approximately $4.10 on the downside to $6.80 on the upside. A TMC collar hedges an existing long TMC 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 TMC IV rank near 0.00% 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 TMC at 86.32%. As a Basic Materials name, TMC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to TMC-specific events.
TMC 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. TMC positions also carry Basic Materials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move TMC alongside the broader basket even when TMC-specific fundamentals are unchanged. Always rebuild the position from current TMC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on TMC?
- A collar on TMC is the collar strategy applied to TMC (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 TMC stock trading near $5.45, the strikes shown on this page are snapped to the nearest listed TMC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are TMC 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 TMC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 86.32%), the computed maximum profit is $26.50 per contract and the computed maximum loss is -$23.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a TMC collar?
- The breakeven for the TMC collar priced on this page is roughly $5.24 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 TMC market-implied 1-standard-deviation expected move is approximately 24.75%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on TMC?
- Collars on TMC hedge an existing long TMC 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 TMC implied volatility affect this collar?
- TMC ATM IV is at 86.32% with IV rank near 0.00%, 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.