WFRD Collar Strategy
WFRD (Weatherford International plc), in the Energy sector, (Oil & Gas Equipment & Services industry), listed on NASDAQ.
Weatherford International plc, an energy services company, provides equipment and services for the drilling, evaluation, completion, production, and intervention of oil, geothermal, and natural gas wells worldwide. The company operates in two segments, Western Hemisphere and Eastern Hemisphere. It offers artificial lift systems, including reciprocating rod, progressing cavity pumping, gas, hydraulic, plunger, and hybrid lift systems, as well as related automation and control systems; pressure pumping and reservoir stimulation services, such as acidizing, fracturing, cementing, and coiled-tubing intervention; and drill stem test tools, surface well testing, and multiphase flow measurement services. The company also provides safety, downhole reservoir monitoring, flow control, and multistage fracturing systems, as well as sand-control technologies, and production and isolation packers; liner hangers to suspend a casing string in high-temperature and high-pressure wells; cementing products, including plugs, float and stage equipment, and torque-and-drag reduction technology for zonal isolation; and pre-job planning and installation services. In addition, it offers directional drilling services, and logging and measurement services while drilling; services related to rotary-steerable systems, high-temperature and high-pressure sensors, drilling reamers, and circulation subs; rotating control devices and advanced automated control systems, as well as closed-loop drilling, air drilling, managed-pressure drilling, and underbalanced drilling services; open hole and cased-hole logging services; and intervention and remediation services. Further, the company provides tubular handling, management, and connection services; and re-entry, fishing, wellbore cleaning, and well abandonment services, as well as patented bottom hole, tubularhandling equipment, pressure-control equipment, and drill pipe and collars.
WFRD (Weatherford International plc) trades in the Energy sector, specifically Oil & Gas Equipment & Services, with a market capitalization of approximately $7.85B, a trailing P/E of 16.94, a beta of 0.92 versus the broader market, a 52-week range of 42.75-112.31, average daily share volume of 1.4M, a public-listing history dating back to 2021, approximately 18K full-time employees. These structural characteristics shape how WFRD stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.92 places WFRD roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. WFRD pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a collar on WFRD?
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 WFRD snapshot
As of May 15, 2026, spot at $108.68, ATM IV 42.90%, IV rank 24.49%, expected move 12.30%. The collar on WFRD 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 WFRD specifically: IV regime affects collar pricing on both sides; compressed WFRD IV at 42.90% typically pushes the short call premium to roughly offset the long put cost, with a market-implied 1-standard-deviation move of approximately 12.30% (roughly $13.37 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 WFRD expiries trade a higher absolute premium for lower per-day decay. Position sizing on WFRD should anchor to the underlying notional of $108.68 per share and to the trader's directional view on WFRD stock.
WFRD collar setup
The WFRD 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 WFRD near $108.68, the first option leg uses a $115.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed WFRD 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 WFRD shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $108.68 | long |
| Sell 1 | Call | $115.00 | $3.25 |
| Buy 1 | Put | $105.00 | $3.95 |
WFRD collar risk and reward
- Net Premium / Debit
- -$10,938.00
- Max Profit (per contract)
- $562.00
- Max Loss (per contract)
- -$438.00
- Breakeven(s)
- $109.38
- Risk / Reward Ratio
- 1.283
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.
WFRD collar payoff curve
Modeled P&L at expiration across a range of underlying prices for the collar on WFRD. 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% | -$438.00 |
| $24.04 | -77.9% | -$438.00 |
| $48.07 | -55.8% | -$438.00 |
| $72.10 | -33.7% | -$438.00 |
| $96.12 | -11.6% | -$438.00 |
| $120.15 | +10.6% | +$562.00 |
| $144.18 | +32.7% | +$562.00 |
| $168.21 | +54.8% | +$562.00 |
| $192.24 | +76.9% | +$562.00 |
| $216.27 | +99.0% | +$562.00 |
When traders use collar on WFRD
Collars on WFRD hedge an existing long WFRD 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.
WFRD thesis for this collar
The market-implied 1-standard-deviation range for WFRD extends from approximately $95.31 on the downside to $122.05 on the upside. A WFRD collar hedges an existing long WFRD 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 WFRD IV rank near 24.49% 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 WFRD at 42.90%. As a Energy name, WFRD options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to WFRD-specific events.
WFRD 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. WFRD positions also carry Energy sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move WFRD alongside the broader basket even when WFRD-specific fundamentals are unchanged. Always rebuild the position from current WFRD chain quotes before placing a trade.
Frequently asked questions
- What is a collar on WFRD?
- A collar on WFRD is the collar strategy applied to WFRD (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 WFRD stock trading near $108.68, the strikes shown on this page are snapped to the nearest listed WFRD chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are WFRD 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 WFRD collar priced from the end-of-day chain at a 30-day expiry (ATM IV 42.90%), the computed maximum profit is $562.00 per contract and the computed maximum loss is -$438.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a WFRD collar?
- The breakeven for the WFRD collar priced on this page is roughly $109.38 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 WFRD market-implied 1-standard-deviation expected move is approximately 12.30%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a collar on WFRD?
- Collars on WFRD hedge an existing long WFRD 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 WFRD implied volatility affect this collar?
- WFRD ATM IV is at 42.90% with IV rank near 24.49%, 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.