Collar Calculator
See your protected floor, capped upside and net cost for a protective collar — including whether it's zero-cost. Free, no signup.
What is Collar?
Collar is a protective strategy on stock you already own: you buy an out-of-the-money put to floor your downside and sell an out-of-the-money call to cap your upside. The call premium finances the put, so the hedge is cheap or free.
This calculator shows exactly where the floor and cap sit, and whether the structure is zero-cost.
Your Collar
A protective put alone keeps your upside but costs full premium — compare on the protective put calculator. Read the strategy on the collar guide.
Your Protection
How the Collar Calculator Works
A collar wraps stock you already own in two options: a protective put below the price (your floor) and a covered call above it (your cap). The call premium you collect offsets the put premium you pay, so the hedge is cheap — and when the two premiums are equal, it's a zero-cost collar.
The calculator computes the net cost per share (put premium − call premium), then projects total position P&L across every stock price. Below the put strike the value is flat — your loss is floored. Above the call strike it's flat too — your gain is capped. In between, you participate in the stock one-for-one.
Max profit = call strike − entry − net cost. Max loss = entry − put strike + net cost. Breakeven sits at entry + net cost. Tighter strikes give a flatter ride; wider strikes loosen both the floor and the cap.
Frequently Asked Questions
What is a collar calculator?
A tool that shows the protected floor, capped upside, net cost and breakeven of a collar — long stock plus a protective put and a covered call. It tells you instantly whether your collar is zero-cost.
What is a zero-cost collar?
One where the call premium collected fully funds the protective put, so the hedge costs nothing in cash. The trade-off is a lower cap, since you sell a closer call to collect enough premium.
How are max profit and max loss calculated?
Max profit = call strike − entry − net cost. Max loss = entry − put strike + net cost. Net cost = put premium − call premium. The put floors your downside; the call caps your upside.
When should I use a collar?
When you hold appreciated or high-conviction stock you don't want to sell but want to protect, or heading into an uncertain stretch. You accept a capped upside for a defined, cheap-to-free floor. See the collar backtest for how it behaves across regimes.