How are ULTA 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 ULTA collar priced from the end-of-day chain at a 30-day expiry (ATM IV 51.36%), the computed maximum profit is $2,728.00 per contract and the computed maximum loss is -$2,272.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a ULTA collar?

The breakeven for the ULTA collar priced on this page is roughly $492.72 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 ULTA market-implied 1-standard-deviation expected move is approximately 14.72%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current ULTA implied volatility affect this collar?

ULTA ATM IV is at 51.36% with IV rank near 99.54%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.

ULTA Collar Strategy

ULTA (Ulta Beauty, Inc.), in the Consumer Cyclical sector, (Specialty Retail industry), listed on NASDAQ.

Ulta Beauty, Inc. operates as a retailer of beauty products in the United States. The company's stores offer cosmetics, fragrances, skincare and haircare products, bath and body products, and salon styling tools; professional hair products; salon services, including hair, skin, makeup, and brow services; and nail services. It also provides its private label products, such as the Ulta Beauty Collection branded cosmetics, skincare, and bath products, as well as Ulta Beauty branded products; and the Ulta Beauty branded gifts. As of March 10, 2022, the company operated 1,308 retail stores across 50 states. It also distributes its products through its website ulta.com; and mobile applications. The company was formerly known as Ulta Salon, Cosmetics & Fragrance, Inc. and changed its name to Ulta Beauty, Inc. in January 2017.

ULTA (Ulta Beauty, Inc.) trades in the Consumer Cyclical sector, specifically Specialty Retail, with a market capitalization of approximately $21.52B, a trailing P/E of 19.13, a beta of 0.89 versus the broader market, a 52-week range of 402.5-714.97, average daily share volume of 715K, a public-listing history dating back to 2007, approximately 20K full-time employees. These structural characteristics shape how ULTA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.89 places ULTA roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a collar on ULTA?

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 ULTA snapshot

As of May 15, 2026, spot at $493.77, ATM IV 51.36%, IV rank 99.54%, expected move 14.72%. The collar on ULTA 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 ULTA specifically: IV regime affects collar pricing on both sides; elevated ULTA IV at 51.36% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 14.72% (roughly $72.71 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 ULTA expiries trade a higher absolute premium for lower per-day decay. Position sizing on ULTA should anchor to the underlying notional of $493.77 per share and to the trader's directional view on ULTA stock.

ULTA collar setup

The ULTA 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 ULTA near $493.77, the first option leg uses a $520.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ULTA 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 ULTA shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$493.77	long
Sell 1	Call	$520.00	$18.65
Buy 1	Put	$470.00	$17.60

ULTA collar risk and reward

Net Premium / Debit: -$49,272.00
Max Profit (per contract): $2,728.00
Max Loss (per contract): -$2,272.00
Breakeven(s): $492.72
Risk / Reward Ratio: 1.201

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.

ULTA collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on ULTA. 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%	-$2,272.00
$109.18	-77.9%	-$2,272.00
$218.36	-55.8%	-$2,272.00
$327.53	-33.7%	-$2,272.00
$436.71	-11.6%	-$2,272.00
$545.88	+10.6%	+$2,728.00
$655.06	+32.7%	+$2,728.00
$764.23	+54.8%	+$2,728.00
$873.40	+76.9%	+$2,728.00
$982.58	+99.0%	+$2,728.00

When traders use collar on ULTA

Collars on ULTA hedge an existing long ULTA 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.

ULTA thesis for this collar

The market-implied 1-standard-deviation range for ULTA extends from approximately $421.06 on the downside to $566.48 on the upside. A ULTA collar hedges an existing long ULTA 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 ULTA IV rank near 99.54% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on ULTA at 51.36%. As a Consumer Cyclical name, ULTA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ULTA-specific events.

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

Frequently asked questions

What is a collar on ULTA?: A collar on ULTA is the collar strategy applied to ULTA (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 ULTA stock trading near $493.77, the strikes shown on this page are snapped to the nearest listed ULTA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ULTA 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 ULTA collar priced from the end-of-day chain at a 30-day expiry (ATM IV 51.36%), the computed maximum profit is $2,728.00 per contract and the computed maximum loss is -$2,272.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a ULTA collar?: The breakeven for the ULTA collar priced on this page is roughly $492.72 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 ULTA market-implied 1-standard-deviation expected move is approximately 14.72%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on ULTA?: Collars on ULTA hedge an existing long ULTA 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 ULTA implied volatility affect this collar?: ULTA ATM IV is at 51.36% with IV rank near 99.54%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.