Straddle vs collarForums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Straddle vs collarThis topic has 1 reply, 2 voices, and was last updated 6 years ago by John Moffat.Viewing 2 posts - 1 through 2 (of 2 total)AuthorPosts February 25, 2018 at 10:54 am #438855 boma77MemberTopics: 70Replies: 97☆☆Dear Tutor,I have difficultiy in undertanding the difference between a straddle and option collars. Could you plase help.Thank you. February 25, 2018 at 11:07 am #438862 John MoffatKeymasterTopics: 57Replies: 54448☆☆☆☆☆A collar is when you have a put and a call option in such a way as to fix a maximum and minimum interest rate (a cap and a floor).It becomes a straddle when the put and call option are both at the same strike price (which then effectively fixes the interest rate).Please do read my article on collars: https://opentuition.com/articles/p4/interest-rate-collars/AuthorPostsViewing 2 posts - 1 through 2 (of 2 total)The topic ‘Straddle vs collar’ is closed to new replies.