UNM Collar Strategy
UNM (Unum Group), in the Financial Services sector, (Insurance - Life industry), listed on NYSE.
Unum Group, together with its subsidiaries, provides financial protection benefit solutions primarily in the United States, the United Kingdom, and Poland. It operates through Unum US, Unum International, Colonial Life, and Closed Block segments. The company offers group long-term and short-term disability, group life, and accidental death and dismemberment products; supplemental and voluntary products, such as individual disability, voluntary benefits, and dental and vision products; and accident, sickness, disability, life, and cancer and critical illness products. It also provides group pension, individual life and corporate-owned life insurance, reinsurance pools and management operations, and other products. The company sells its products primarily to employers for the benefit of employees. Unum Group sells its products through field sales personnel, independent brokers, consultants, and independent contractor agency sales force.
UNM (Unum Group) trades in the Financial Services sector, specifically Insurance - Life, with a market capitalization of approximately $12.85B, a trailing P/E of 16.89, a beta of 0.23 versus the broader market, a 52-week range of 68.28-83.13, average daily share volume of 1.6M, a public-listing history dating back to 1986, approximately 11K full-time employees. These structural characteristics shape how UNM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.23 indicates UNM has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. UNM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on UNM?
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 UNM snapshot
As of May 15, 2026, spot at $81.80, ATM IV 22.10%, IV rank 22.47%, expected move 6.34%. The collar on UNM 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 UNM specifically: IV regime affects collar pricing on both sides; compressed UNM IV at 22.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 6.34% (roughly $5.18 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 UNM expiries trade a higher absolute premium for lower per-day decay. Position sizing on UNM should anchor to the underlying notional of $81.80 per share and to the trader's directional view on UNM stock.
UNM collar setup
The UNM 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 UNM near $81.80, the first option leg uses a $85.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed UNM 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 UNM shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $81.80 | long |
| Sell 1 | Call | $85.00 | $0.85 |
| Buy 1 | Put | $77.50 | $0.88 |
UNM collar risk and reward
- Net Premium / Debit
- -$8,182.50
- Max Profit (per contract)
- $317.50
- Max Loss (per contract)
- -$432.50
- Breakeven(s)
- $81.83
- Risk / Reward Ratio
- 0.734
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.
UNM collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on UNM. 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% | -$432.50 |
| $18.10 | -77.9% | -$432.50 |
| $36.18 | -55.8% | -$432.50 |
| $54.27 | -33.7% | -$432.50 |
| $72.35 | -11.6% | -$432.50 |
| $90.44 | +10.6% | +$317.50 |
| $108.52 | +32.7% | +$317.50 |
| $126.61 | +54.8% | +$317.50 |
| $144.69 | +76.9% | +$317.50 |
| $162.78 | +99.0% | +$317.50 |
When traders use collar on UNM
Collars on UNM hedge an existing long UNM 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.
UNM thesis for this collar
The market-implied 1-standard-deviation range for UNM extends from approximately $76.62 on the downside to $86.98 on the upside. A UNM collar hedges an existing long UNM 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 UNM IV rank near 22.47% 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 UNM at 22.10%. As a Financial Services name, UNM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to UNM-specific events.
UNM 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. UNM positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move UNM alongside the broader basket even when UNM-specific fundamentals are unchanged. Always rebuild the position from current UNM chain quotes before placing a trade.
Frequently asked questions
- What is a collar on UNM?
- A collar on UNM is the collar strategy applied to UNM (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 UNM stock trading near $81.80, the strikes shown on this page are snapped to the nearest listed UNM chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are UNM 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 UNM collar priced from the end-of-day chain at a 30-day expiry (ATM IV 22.10%), the computed maximum profit is $317.50 per contract and the computed maximum loss is -$432.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a UNM collar?
- The breakeven for the UNM collar priced on this page is roughly $81.83 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 UNM market-implied 1-standard-deviation expected move is approximately 6.34%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on UNM?
- Collars on UNM hedge an existing long UNM 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 UNM implied volatility affect this collar?
- UNM ATM IV is at 22.10% with IV rank near 22.47%, 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.