Volworks recommends and uses zero-cost put spread collars for hedging equity and ETF positions. For this analysis, we analyzed put spread collars that expire 12/20/2024 (158 days) at a level of 95%-85% of spot. Of note, the Volworks Platform can analyze and generate zero cost put spread collars for any expiration and different percentages of spot.

 

Our report provides all the relevant metrics, including the most important, the short call to finance the put spread. We selected 9 mega-caps, which include the Mag 7 stocks in addition to QQQ, UNH, and COST. As many of these symbols have had great returns year to date, many investors are interested in protecting at least some portion of their exposure.

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See below a payoff chart for the AMZN zero cost put spread collar.