Apr 6, 2021
Collar Option Strategy
A collar options strategy that consists of buying or owning the stock, and then buying a put option at strike price A, and selling a call option at strike price B. An options trader who enters this strategy wants the stock to trade higher and get called away at the call strike price B. However, also wants protection in case the stock price falls below strike price A, giving the them the right to exercise the option contract and sell the stock if it does.