Breakeven, how much capital a long-dated call saves against shares, and what you're paying for time.
LEAPS details
Results
P&L at target uses intrinsic value only (it ignores remaining time value), so a LEAPS you sell before expiration will typically be worth more than shown. Breakeven assumes you hold to expiration.
A deep in-the-money LEAPS call
Stock at $100. An 18-month $70 call costs $35.00 → $3,500.
100 shares would cost $10,000. Capital saved: $6,500.
Intrinsic: $30. Extrinsic: $5 — that's what decays.
Breakeven: $70 + $35 = $105.
Three things shares do that this doesn't
It expires, so being right afterwards pays nothing. It decays — the extrinsic value bleeds away even if the stock never moves. And it pays no dividends, which on a 3% yielder is roughly 4.5% forgone over 18 months, a real share of the capital you saved.
LEAPS
Buying a year or more of exposure for a fraction of the share price — and what that discount costs.
Educational only
These figures come from the numbers you enter and standard options arithmetic. Nothing here is investment, financial, or tax advice, and a good-looking return says nothing about whether the underlying stock is a good idea.
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