Collar

collar investment & finance definition
Listen
A restriction on index-arbitrage trading, which is also called program trading. Collars are imposed to keep markets stable by restricting extreme price movements.

Collar
(1) the highest and lowest rates of interest that will be paid on the face value of a floating-rate note. (2) an agreement between a buyer and seller. The buyer pays a fee to the seller.

Hi Phil, by the definition of a collar the options have to belong to the same expiration date. I actually do not know what this type of spread would be called.

Blue Collar - the term blue collar is used to describe a certain type of employment. Blue collar is a phrase used to describe non office or management works such as laborers, or factory workers.

A collar is a useful tool in bear markets or when you are uncertain about a business.

Zero Cost Collar
Investment Dictionary:
Zero Cost Collar
Home > Library > Business & Finance > Investment Dictionary ...

A "Costless Collar"
Another typical configuration of a collar is what is known as a "costless" collar.

Collar Strategy -An option strategy used when an investor expects a particular stock to advance in price, but realizes that there is a chance that it could decline.

Collar
Upper and lower limits (cap and floor, respectively) on the interest rate of a floating-rate security
Constant Maturity Treasury Series (CMT) ...

Collar (see also Range Forward; Risk Reversal) - A combination of options in which the holder of the contract has bought one out-of-the money option call (or put) and sold one (or more) out-of-the-money puts (or calls).

Collar: This is normally the purchase of an interest rate cap and the sale of an interest rate floor. Frequently it used to hedge the interest rate cost associated with floating rate, (Libor linked), funding.

COLLARS Options which have the same payoff as the standard call expect that the upside is not unlimited but is subject to a maximum. The option buyer forgoes any payoff above this maximum.

COLLAR - (1) An agreement entered into by the issuer or obligor of variable rate debt combining an interest rate cap and an interest rate floor. See: INTEREST RATE CAP; INTEREST RATE FLOOR.

Collar Option Spread
The Collar option spread is a way to utilize the covered call strategy. Only this strategy looks at the big problem of covered calls, the down side.

Equity collar
The simultaneous purchase of an equity floor and sale of an equity cap.
Equity floor ...

Collar width
Collateral (in the context of margin lending)
Collateralized Debt Obligation (CDO) ...

Collar options can serve as vital protection for your portfolio during a bear market -- and prevent you from hastily exiting a trade.
Post Your Comments...
View Our Comments Policy ...

Collar
A protective strategy in which a written call and a long put are taken against a previously owned long stock position. The options may have the same strike price or different strike prices and the expiration months may or may not be the same.

Collar
A combination of a cap and a floor. A collar sets a band within which interest rates will apply (e.g. 10%-13.75%), for a given period.
Collateral ...

Collar
Refers to the ceiling and floor of the price fluctuation of an underlying asset. A collar is usually set up with options, swaps, or by other agreements.

Some collars have a metal tag affixed to them so that you can have your contact details or phone number engraved on it, others have a ring, so that you can attach a small canister with your details inside it.

Zero Cost Collar
A type of positive-carry collar that secures a return through the purchase of a cap and sale of a floor. Also called "zero cost options" or "equity risk reversals."
...

Use Options to Collar Danger Before It Strikes
Using Options to Protect Yourself in Dangerous Times
An Education in Expiration ...

One Way Collared Note A One Way Floating Rate Note (q.v.). One Way Floater A One Way Floating Rate Note (q.v.).

blue-collar Refers to employees who perform manual labor, such as in a factory. BMD The currency of Bermuda. ISO international currency code: BMD. Learn... BND The currency of Brunei. ISO international currency code: BND. Learn...

Interest Rate Collar
A combination of a cap and a floor to provide maximum and minimum interest rates for borrowing or lending.

[grabs Osato firmly by the collar ad hurriedly begins to unbutton his shirt] Osato, have me now. Immediately. Osato, have me, now! Immediately. Osato, please have me now, immediately. Osato, I love you. Osato, I love you. Osato: - Wait Esohe! Wait.

Collar This strategy involves the purchase of stock and the sale of a call against that stock (covered call), while purchasing a put option on the same stock (protective put). Also known as a "fence" or "cylinder".

Insider trading is not a new white-collar crime; the use of privileged information for financial gain has been around since the inception of stock trading.

The following are the four types of Interest Rate Derivative Instruments: interest rate options; interest rate futures and forwards; interest rate swaps; and, interest rate caps, floors, and collars.

Actually, I found that a bit refreshing because my background is rooted in a blue-collar-type work ethic.

Alan Ellman, author of the best-selling Cashing In on Covered Calls, speaks to the average blue collar investors of the world.

Collar (finance)
Collective investment scheme
Common contractual fund
Constant dollar plan
Constant mix (investment)
Constant proportion portfolio insurance
Convention of conservatism
Core & Satellite
Covestor
CPP Investment Board ...

It refers to range of instruments like caps, swaps, and collars, where the notional principal amount on which the instrument is based increases successively during its life.
Advertisement ...

This should reflect the danger or opportunity in the market at that time. I call this collaring. Get defensive in dangerous conditions by raising cash and taking smaller positions.

Selling options is in the long run pretty much a losing proposal so it’s not a strategy that is right. Even if the investor employs a collar where he can limit his downside selling options is not a recommended commodity strategy for producers ...

This measure is primarily used to prevent the market from falling too much during the regular trading session. Below are the trading curbs in rules for the Dow Jones. Curbs in are also known as circuit breakers and collar breakers.

adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes. Typically, such issues have a set floor or ceiling, called caps and collars ...

Governor Bollard said that, "While helping contain inflation the high value of the new Zealand collar is detrimental to the tradable sector, undermines GDP growth and inhibits rebalancing in the New Zealand economy.