2022年1月5日 · The premium collected from the "short" call (the one you're selling) helps to "offset" the cost of the ITM long call (the one you're buying). ----- Buying a single-leg call vs a vertical call spread: A single-leg call has limited losses and unlimited profit potential (theoretically), but you will also lose more money if you're wrong.

2021年2月20日 · Here are the questions. For long term call options where I am expecting solid steady growth, does it make more sense to buy OTM options over ITM? Also at what point when you have an ITM call option, do you worry about time decay. Ex. I have a $59 call for ARKF expiring April 16.

Hello everyone, I have a question regarding buying a far OTM call option with a long expiration date. If based on my research, I believe a company will rise in the future based on its performance, and I want to leverage the potential profit with options. But, I am not sure when the stock price will reflec

2020年6月23日 · For example if a $10-wide OTM call spread (like $100/$110) costs $4 then your max ROI will be 150%. That's because $10 wide spread will be worth max $10 when the stock price lands above both your OTM strikes at expiration, while you've spent $4, so you'd make $6 profit on the $4 investment.

2021年6月8日 · Lately, the bulk of my options trading strategy has been to buy deep OTM call options with 5+ month expirations. I'm not a highly active trader, so the bulk of my money is in long-term growth equities. Then I keep a portion aside for …

2021年1月17日 · So if you have the option to buy a LEAP ITM call for say, $2100, the most delta you’re going to get will be 1. Compare that to buying instead 3 OTM calls for $700 each. If you gauge underlying appreciation correctly and your OTM calls become ITM, you’ve got yourself a delta of 3 for the same initial investment.

One strategy you can do, is take the capital that you would spend on 100 shares, and instead you can purchase one safe ITM leap call, and with the remaining capital buy very far OTM calls. For every 100 shares you would have bought for TSM’s current price of ~$100, you can buy one call at $50, and with your remaining capital buy 5 calls at $145.

Any longer dated call with a lower strike call will cover a sold call. This is the general form of a call diagonal spread. However, if you are using the LEAPS as a stock replacement then you should make sure that your long call is deep ITM so it has a high delta and moves close to 100 shares of the underlying, so the overall position acts most ...

2020年5月21日 · Let's look at a deep OTM call. The intrinsic value = $0. It's less likely that the stock price will go up to reach the deep OTM strike price than $77. Thus, the "potential" value of the deep OTM call must be even less than that of the $77 call. So the extrinsic value << $1 (and > $0). Now let's look at the $73 call. The intrinsic value = $2.

2021年4月24日 · LEAPS always carry a lot of extrinsic value because they're so far out, but "the market can stay irrational longer than you can stay solvent," comes to mind when you make a very directional play like an OTM call. Often times an ITM LEAPS is used as a cheaper stock replacement on more pricy stocks or as collateral for a covered call.