How are VERX 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 VERX collar priced from the end-of-day chain at a 30-day expiry (ATM IV 65.10%), the computed maximum profit is $131.50 per contract and the computed maximum loss is $31.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a VERX collar?

The breakeven for the VERX collar priced on this page is no defined breakeven on the modeled curve 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 VERX market-implied 1-standard-deviation expected move is approximately 18.66%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current VERX implied volatility affect this collar?

VERX ATM IV is at 65.10% with IV rank near 29.93%, 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.

VERX Collar Strategy

VERX (Vertex, Inc.), in the Technology sector, (Software - Application industry), listed on NASDAQ.

Vertex, Inc. specializes in delivering advanced tax technology solutions to corporations across various sectors, including retail, communication, leasing, and manufacturing. These services are provided to clients both within the United States and globally. Its comprehensive product portfolio encompasses tools for tax determination, compliance and reporting, efficient tax data and document management, pre-built integration capabilities, and specialized solutions tailored to specific industries. Clients can access their software through traditional on-premise licenses or via cloud-based Software as a Service (SaaS) subscriptions. Beyond its software offerings, Vertex also delivers essential support services. These include implementation and training for its licensed and cloud-based products, as well as outsourced transaction tax return processing and other ancillary tax-related consultations.

VERX (Vertex, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $1.84B, a beta of 0.80 versus the broader market, a 52-week range of 10.21-36.75, average daily share volume of 1.5M, a public-listing history dating back to 2020, approximately 2K full-time employees. These structural characteristics shape how VERX stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.80 places VERX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.

What is a collar on VERX?

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 VERX snapshot

As of June 30, 2026, spot at $11.56, ATM IV 65.10%, IV rank 29.93%, expected move 18.66%. The collar on VERX 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 80-day expiry.

Why this collar structure on VERX specifically: IV regime affects collar pricing on both sides; compressed VERX IV at 65.10% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 18.66% (roughly $2.16 on the underlying). The 80-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated VERX expiries trade a higher absolute premium for lower per-day decay. Position sizing on VERX should anchor to the underlying notional of $11.56 per share and to the trader's directional view on VERX stock.

VERX collar setup

The VERX 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 VERX near $11.56, the first option leg uses a $12.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed VERX chain at a 80-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 VERX shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 100 shares	Stock	$11.56	long
Sell 1	Call	$12.00	$2.20
Buy 1	Put	$11.00	$1.33

VERX collar risk and reward

Net Premium / Debit: -$1,068.50
Max Profit (per contract): $131.50
Max Loss (per contract): $31.50
Breakeven(s): None on modeled curve
Risk / Reward Ratio: 4.175

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.

VERX collar payoff curve

Modeled P&L at expiration across a range of underlying prices for the collar on VERX. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-99.9%	+$31.50
$2.56	-77.8%	+$31.50
$5.12	-55.7%	+$31.50
$7.67	-33.6%	+$31.50
$10.23	-11.5%	+$31.50
$12.78	+10.6%	+$131.50
$15.34	+32.7%	+$131.50
$17.89	+54.8%	+$131.50
$20.45	+76.9%	+$131.50
$23.00	+99.0%	+$131.50

When traders use collar on VERX

Collars on VERX hedge an existing long VERX 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.

VERX thesis for this collar

The market-implied 1-standard-deviation range for VERX extends from approximately $9.40 on the downside to $13.72 on the upside. A VERX collar hedges an existing long VERX 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 VERX IV rank near 29.93% 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 VERX at 65.10%. As a Technology name, VERX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to VERX-specific events.

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

Frequently asked questions

What is a collar on VERX?: A collar on VERX is the collar strategy applied to VERX (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 VERX stock trading near $11.56, the strikes shown on this page are snapped to the nearest listed VERX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are VERX 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 VERX collar priced from the end-of-day chain at a 30-day expiry (ATM IV 65.10%), the computed maximum profit is $131.50 per contract and the computed maximum loss is $31.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a VERX collar?: The breakeven for the VERX collar priced on this page is no defined breakeven on the modeled curve 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 VERX market-implied 1-standard-deviation expected move is approximately 18.66%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a collar on VERX?: Collars on VERX hedge an existing long VERX 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 VERX implied volatility affect this collar?: VERX ATM IV is at 65.10% with IV rank near 29.93%, 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.