A collar (col) broadly refers to a hedge strategy.
You can:
Buy a call (long call) and sell a put (short put), with different strikes but typically the same notional and expiry date.
Buy a put (long put) and sell a call (short call), with different strikes but typically the same notional and expiry date.
Volatility quotes for collars are used as benchmarks to create a volatility surface.
Why use a collar?
You would enter into a collar if you want to hedge your underlying risk while lowering the cost of this premium.
Although selling a call (put) limits the upside potential of the hedge, for many corporates it is more important to be hedged at minimal cost. To that end, one of the most popular collars is the zero cost collar where you do not have to pay a premium.
If you have a:
Short underlying position you would buy a collar (buy a call and sell a put).
Long underlying position you would sell a collar (buy a put and selling a call).
Pricing a collar in SDX Commodities & Energy
You can only automatically enter into a collar in the Single Option page. To price a collar in the Portfolio page, you need to build it manually out of its individual components