{"id":217346,"date":"2026-08-24T16:13:06","date_gmt":"2026-08-24T10:43:06","guid":{"rendered":"https:\/\/univest.in\/blogs-2\/?p=217346"},"modified":"2026-08-24T16:13:08","modified_gmt":"2026-08-24T10:43:08","slug":"collar-strategy-nifty-50","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/collar-strategy-nifty-50\/","title":{"rendered":"Collar Strategy Nifty 50: Setup, Payoff and Risk Guide"},"content":{"rendered":"
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Nifty 50 level used in this article: Rs 24,216 (as of 24 Aug 2026). Next weekly (Tuesday) and monthly (last Tuesday of the month) expiry: 25 August 2026 (Tuesday). Lot size 65. Nifty 50 retained its weekly expiry slot on NSE under SEBI’s one weekly index per exchange rule; Bank Nifty, Nifty Financial Services, and Nifty Midcap Select lost their weekly contracts instead, in November 2024. Both weekly and monthly Nifty 50 contracts remain available.<\/em><\/p>\n

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Quick Answer<\/strong><\/p>\n

The collar strategy Nifty 50 combines a long Nifty 50 futures or equivalent position with a protective put purchase and a covered call sale, creating a rangebound payoff that limits both downside loss and upside gain. With Nifty 50 at Rs 24,216, the collar strategy Nifty 50 may be considered by traders who already hold a bullish Nifty 50 futures position and want to reduce downside risk, typically at little to no net cost since the premium from the sold call can offset the cost of the purchased put. Because Nifty 50 only trades monthly options, the collar strategy Nifty 50 is generally structured around the monthly expiry cycle.<\/p>\n<\/div>\n

Unlike the other strategies in this series, the this strategy is built around an existing directional position rather than being a standalone options trade. It is most commonly used by traders or investors who hold Nifty 50 futures and want to define a floor and a ceiling on their potential outcome over the monthly cycle, in exchange for giving up unlimited upside.<\/p>\n

The collar strategy Nifty 50 is sometimes structured as a zero cost collar, where the premium received from selling the call closely offsets the premium paid for the put. This is not guaranteed and depends on the specific strikes chosen relative to the current index level and the prevailing implied volatility skew.<\/p>\n

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