Hey Investors and Traders!
Before reading this, please make sure you've gone through the Level 2 videos and taken the quizzes. Trust us, it'll be much easier to understand if you understand how the Greeks work.
AAPL LEAPs
Because we are bullish on AAPL, you might want to consider purchasing around a Delta 80 LEAPs call option. Right now, AAPL is in between earnings dates, with the next one in early February, and we are in the holiday season, which means that the IV is lower due to lower trading activity from the larger institutions being on break. Typically when IV is lower, we tend to be options buyers as the price of options are cheaper.
Here are the details for the LEAPs call option you can consider purchasing:
Stock: AAPL
Expiration Date: 2023-01-20
Type: Call
Delta: 80
Strike: $85
Investment: $5000
This may be a good LEAPs option for you if you are trading the Wheel Strategy on this stock and you want to profit from AAPL if the price goes past your covered call strike price.
Please remember that we recommend that at least 50% of your LEAPs investment is made from your Wheel premiums, so that you are not just using your own money, but rather the market's money to invest in the LEAPs call option.
When you buy this LEAPs option, know that there will be added volatility in your portfolio, as you are now using leverage to control 100 shares with a smaller capital.
Also, know that your bias on AAPL should be bullish for the next 3-6 months, as we will plan to sell the LEAPs option 1-2 weeks either before the first or second earnings date in 2021.
Good luck everyone and happy holidays!
- 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.