Answer: The trunk protector should be removed before it constricts the tree, yes.
If you have rabbits that might damage the trunk in winter you may want to enclose the trunk in a wire mesh cylinder each fall to try to protect it from that.
The yellowing could be caused by a number of different factors. If it is turning brown and crisp at the tips and edges I would think it is due to heat/moisture stress. You need to water to supplement rain enough to keep the soil evenly moist, like a wrung out sponge. It should not be sopping wet or bone dry, dig into the soil with your finger to check if you need to water. Overwatering is no better than underwatering, so dig down a bit and check the soil. It is better to water deeply less often than a daily light sprinkling.
You should also maintain a flat layer of organic mulch several inches thick over the root area to help keep the soil cool and moist; this also helps hold down weeds and feeds the soil slowly as it breaks down over time. Spread it out flat and do not allow it to touch the bark of the tree.
Another possible cause is over fertilizing (this tree is not a heavy feeder) or even accidental chemical exposure such as from a weed and feed product applied to the adjacent lawn. Another possible soil-based cause is a pH problem. This tree requires soil that is acidic, humusy and evenly moist yet well drained.
It might also be due to transplant shock if you just planted it now in the heat of summer. If this is the case, you could try to shade it a bit at midday (maybe a lawn umbrella would do this) and hope for the best, or possibly better, move it to a cooler location with morning-only sun.
Since this is a new tree, you may also want to consult with your retailer (especialyl if there is a warranty) and/or your local county extension. Good luck with your tree!
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