{"id":217355,"date":"2026-08-24T16:14:50","date_gmt":"2026-08-24T10:44:50","guid":{"rendered":"https:\/\/univest.in\/blogs-2\/?p=217355"},"modified":"2026-08-24T16:14:52","modified_gmt":"2026-08-24T10:44:52","slug":"collar-strategy-sensex","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/collar-strategy-sensex\/","title":{"rendered":"Collar Strategy Sensex: Setup, Payoff and Risk Guide"},"content":{"rendered":"
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Sensex level used in this article: Rs 77,538 (as of 20 Aug 2026). Next weekly (Thursday) and monthly (last Thursday of the month) expiry: 27 August 2026 (Thursday). Lot size 10. Sensex retained its weekly expiry slot on BSE under SEBI’s one weekly index per exchange rule; Bankex and Sensex 50 weekly contracts were discontinued instead, in November 2024. Both weekly and monthly Sensex contracts remain available.<\/em><\/p>\n

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

The collar strategy Sensex combines a long Sensex 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 Sensex at Rs 77,538, the collar strategy Sensex may be considered by traders who already hold a bullish Sensex 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 Sensex only trades monthly options, the collar strategy Sensex 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 Sensex 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 Sensex 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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