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What are LEAPS?
Long- Term Equity Anticipation Securities: Options with >1 year to expiration
Things to consider
Open Interest (Number of open option contracts at that strike price)
Tends to have lower liquidity, lower open interest
Delta
Price: LEAPS are expensive because the potential price movements over multi-year periods are much larger than 30-60 day potential movements
Avoid holding till expiration. Recommended to take profits on these types of trades and/or selling a portion of the options and holding the rest
How it works?
Buying a call option deep ITM (delta 0.7 >)
Expiry one year or more
LEAPS Calls Explained