There are several key differences:
Tax Deferral: Selling triggers immediate capital gains tax, which can range from 23.8% to 38% depending on your tax bracket and state. A Collar Advance allows you to defer this tax liability for the duration of the contract.
Continued Participation: You maintain exposure to your stock's performance within the collar bounds. If your stock appreciates, you benefit up to the cap.
Reversibility: At maturity, you have options. You can receive your shares back by repaying the advance in cash, or settle by delivering shares. An outright sale doesn't offer this flexibility.
Ownership Rights: You retain voting rights and continue receiving dividends during the collar period (though dividends become taxable at ordinary income rates).