VAC Collar Strategy
VAC (Marriott Vacations Worldwide Corporation), in the Consumer Cyclical sector, (Gambling, Resorts & Casinos industry), listed on NYSE.
Marriott Vacations Worldwide Corporation is a prominent global leisure company specializing in the development, marketing, sale, and management of vacation ownership products and associated offerings. Its business operations are structured around two core divisions: Vacation Ownership, and Exchange & Third-Party Management. The corporation oversees numerous vacation ownership brands, including Marriott Vacation Club, Grand Residences by Marriott, Sheraton Vacation Club, Westin Vacation Club, Hyatt Residence Club, and Marriott Vacation Club Pulse. Additionally, it is engaged in the creation, promotion, and sale of timeshare products under The Ritz-Carlton Destination Club brand, and holds the rights to develop, market, and sell luxury residential ownership properties bearing The Ritz-Carlton Residences name. Beyond its core ventures, the enterprise provides exchange networks and membership programs, alongside offering management services to external resorts and lodging facilities through various affiliated brands, such as Interval International, Trading Places International, Vacation Resorts International, and Aqua-Aston. As of December 31, 2021, Marriott Vacations Worldwide maintained a portfolio of approximately 120 properties located across the United States and thirteen other international territories.
VAC (Marriott Vacations Worldwide Corporation) trades in the Consumer Cyclical sector, specifically Gambling, Resorts & Casinos, with a market capitalization of approximately $3.48B, a beta of 1.26 versus the broader market, a 52-week range of 44.58-102, average daily share volume of 514K, a public-listing history dating back to 2011, approximately 22K full-time employees. These structural characteristics shape how VAC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.26 places VAC roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. VAC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on VAC?
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 VAC snapshot
As of June 29, 2026, spot at $102.74, ATM IV 41.90%, IV rank 27.18%, expected move 12.01%. The collar on VAC 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 18-day expiry.
Why this collar structure on VAC specifically: IV regime affects collar pricing on both sides; compressed VAC IV at 41.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 12.01% (roughly $12.34 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated VAC expiries trade a higher absolute premium for lower per-day decay. Position sizing on VAC should anchor to the underlying notional of $102.74 per share and to the trader's directional view on VAC stock.
VAC collar setup
The VAC 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 VAC near $102.74, the first option leg uses a $110.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed VAC chain at a 18-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 VAC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $102.74 | long |
| Sell 1 | Call | $110.00 | $1.03 |
| Buy 1 | Put | $100.00 | $3.28 |
VAC collar risk and reward
- Net Premium / Debit
- -$10,499.00
- Max Profit (per contract)
- $501.00
- Max Loss (per contract)
- -$499.00
- Breakeven(s)
- $104.99
- Risk / Reward Ratio
- 1.004
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.
VAC collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on VAC. 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% | -$499.00 |
| $22.73 | -77.9% | -$499.00 |
| $45.44 | -55.8% | -$499.00 |
| $68.16 | -33.7% | -$499.00 |
| $90.87 | -11.6% | -$499.00 |
| $113.59 | +10.6% | +$501.00 |
| $136.30 | +32.7% | +$501.00 |
| $159.02 | +54.8% | +$501.00 |
| $181.73 | +76.9% | +$501.00 |
| $204.45 | +99.0% | +$501.00 |
When traders use collar on VAC
Collars on VAC hedge an existing long VAC 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.
VAC thesis for this collar
The market-implied 1-standard-deviation range for VAC extends from approximately $90.40 on the downside to $115.08 on the upside. A VAC collar hedges an existing long VAC 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 VAC IV rank near 27.18% 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 VAC at 41.90%. As a Consumer Cyclical name, VAC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to VAC-specific events.
VAC 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. VAC positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move VAC alongside the broader basket even when VAC-specific fundamentals are unchanged. Always rebuild the position from current VAC chain quotes before placing a trade.
Frequently asked questions
- What is a collar on VAC?
- A collar on VAC is the collar strategy applied to VAC (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 VAC stock trading near $102.74, the strikes shown on this page are snapped to the nearest listed VAC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are VAC 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 VAC collar priced from the end-of-day chain at a 30-day expiry (ATM IV 41.90%), the computed maximum profit is $501.00 per contract and the computed maximum loss is -$499.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a VAC collar?
- The breakeven for the VAC collar priced on this page is roughly $104.99 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 VAC market-implied 1-standard-deviation expected move is approximately 12.01%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on VAC?
- Collars on VAC hedge an existing long VAC 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 VAC implied volatility affect this collar?
- VAC ATM IV is at 41.90% with IV rank near 27.18%, 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.