The "daily Call" From Option Alpha: Options Trading | Stock Options | Stock Trading | Trading Online

Hey everyone. This is Kirk here again at optionalpha.com and welcome back to the daily call. Today, we are going to be answering the question, “What are LEAP options?” Yes, L-E-A-P options. Very quickly, leap options are commonly referred to as long-term equity anticipation securities. I know that's a mouthful, I know that's a lot, but that's basically what they are. They are option contract with expiration dates that are usually longer than one year. And so, their allure for many investors and the reason why a lot of people start trading LEAPs is probably a couple of things. One is the ability to get long-term exposure into an underlying with very minimal capital actually outlaid from your account. For example, if you wanted to buy the S&P 500 or the ticker symbol SPY which is the ETF that basically trades that, you could buy the SPY. But right now, it’s trading about 260 ish based on the time I’m recording this podcast, so you have to outlay that much capital times 100 contracts and so, it cost a lot of