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Hi Advanced Traders!

Since it seems that the markets are still bullish and many of you are asking about LEAPS, you can consider purchasing a conservative LEAPS option if you feel comfortable. The keyword here is conservative.

I'm personally holding onto an AAPL Jan 19 2024 Call LEAPS that I've had since the beginning on this year. However, I'm staying disciplined with not purchasing anymore until I see my initial LEAPS turns profitable. I'm also staying on the conservative side because I'm a bit wary of the volatility that may come in the next 1-2 months.

If you want to be patient, you can wait until sometime in November and December to purchase LEAPS to take advantage of the Santa Claus Rally.

However, if you don't mind the volatility, have premiums that you saved up from your trades to fund your LEAPS purchase, and have an account where the LEAPS option doesn't take up more than 5-10% of your account, you can consider purchasing a conservative ITM LEAPS option with an expiration date for Jan 2024 and a delta somewhere around 0.60-0.80. An underlying stock that is in favor right now is AAPL.

I strongly recommend that you do not get greedy with LEAPS. Remember that these are leveraged securities with wild volatility swings and can quickly drop in value if there is a reversal in the markets. If you are going to invest in one, just make sure that you buckle your seatbelt.

If you want to practice purchasing LEAPS, you can do so in a paper trading account, so you can get accustomed to how wild the security can move. Practicing first may help better prepare you if you decide to enter LEAPS in the fourth quarter.

As always, trade and invest responsibly!

-Steve and the Call to Leap Team

The following article is strictly the opinion of the author and is to not be considered financial/investment advice. Call to Leap LLC and the author of this article does not claim to be a registered financial advisor (RIA) or financial advisor. Please visit our terms of service and privacy policy before reading this article.