UBS Collar Strategy
UBS (UBS Group AG), in the Financial Services sector, (Banks - Diversified industry), listed on NYSE.
UBS Group AG, a financial services giant headquartered in Zurich, Switzerland, since its founding in 1862 (and known as UBS AG until its name change in December 2014), delivers a comprehensive range of financial advice and solutions to a global clientele of private individuals, institutions, and corporations. The firm structures its operations across four primary business segments: The Global Wealth Management division caters specifically to affluent and ultra-high-net-worth clients. It provides sophisticated investment guidance, various lending products, including mortgages and securities-based loans, and extensive planning services encompassing estate and wealth management, philanthropy, corporate and banking services, and family advisory. Through its Personal & Corporate Banking arm, UBS supports individual clients with essential banking services like deposits, cards, and digital platforms, alongside financing, investment opportunities, and retirement solutions. For corporate and institutional clients, this division furnishes a wide array of solutions, spanning equity and debt capital market activities, syndicated and structured credit facilities, private placements, leasing, traditional financing, international trade and export finance, global custody, and transactional banking for payments and liquidity management. The Asset Management division specializes in a broad spectrum of investment strategies, encompassing equities, fixed income, hedge funds, real estate, and private market assets.
UBS (UBS Group AG) trades in the Financial Services sector, specifically Banks - Diversified, with a market capitalization of approximately $160.91B, a trailing P/E of 19.56, a beta of 0.84 versus the broader market, a 52-week range of 33.48-51.24, average daily share volume of 2.4M, a public-listing history dating back to 2000, approximately 107K full-time employees. These structural characteristics shape how UBS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.84 places UBS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. UBS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on UBS?
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 UBS snapshot
As of June 29, 2026, spot at $49.56, ATM IV 25.10%, IV rank 20.45%, expected move 7.20%. The collar on UBS 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 200-day expiry.
Why this collar structure on UBS specifically: IV regime affects collar pricing on both sides; compressed UBS IV at 25.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 7.20% (roughly $3.57 on the underlying). The 200-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated UBS expiries trade a higher absolute premium for lower per-day decay. Position sizing on UBS should anchor to the underlying notional of $49.56 per share and to the trader's directional view on UBS stock.
UBS collar setup
The UBS 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 UBS near $49.56, the first option leg uses a $52.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UBS chain at a 200-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 UBS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $49.56 | long |
| Sell 1 | Call | $52.50 | $3.40 |
| Buy 1 | Put | $47.50 | $2.85 |
UBS collar risk and reward
- Net Premium / Debit
- -$4,901.00
- Max Profit (per contract)
- $349.00
- Max Loss (per contract)
- -$151.00
- Breakeven(s)
- $49.01
- Risk / Reward Ratio
- 2.311
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.
UBS collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on UBS. 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% | -$151.00 |
| $10.97 | -77.9% | -$151.00 |
| $21.92 | -55.8% | -$151.00 |
| $32.88 | -33.7% | -$151.00 |
| $43.84 | -11.5% | -$151.00 |
| $54.79 | +10.6% | +$349.00 |
| $65.75 | +32.7% | +$349.00 |
| $76.71 | +54.8% | +$349.00 |
| $87.67 | +76.9% | +$349.00 |
| $98.62 | +99.0% | +$349.00 |
When traders use collar on UBS
Collars on UBS hedge an existing long UBS 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.
UBS thesis for this collar
The market-implied 1-standard-deviation range for UBS extends from approximately $45.99 on the downside to $53.13 on the upside. A UBS collar hedges an existing long UBS 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 UBS IV rank near 20.45% 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 UBS at 25.10%. As a Financial Services name, UBS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UBS-specific events.
UBS 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. UBS positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UBS alongside the broader basket even when UBS-specific fundamentals are unchanged. Always rebuild the position from current UBS chain quotes before placing a trade.
Frequently asked questions
- What is a collar on UBS?
- A collar on UBS is the collar strategy applied to UBS (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 UBS stock trading near $49.56, the strikes shown on this page are snapped to the nearest listed UBS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UBS 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 UBS collar priced from the end-of-day chain at a 30-day expiry (ATM IV 25.10%), the computed maximum profit is $349.00 per contract and the computed maximum loss is -$151.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UBS collar?
- The breakeven for the UBS collar priced on this page is roughly $49.01 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 UBS market-implied 1-standard-deviation expected move is approximately 7.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on UBS?
- Collars on UBS hedge an existing long UBS 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 UBS implied volatility affect this collar?
- UBS ATM IV is at 25.10% with IV rank near 20.45%, 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.