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Hey Members!

Since we are past NKE earnings, IV for the stock is currently lower, which means that it is less expensive to get into a NKE LEAPs options. 🤗

Here is a snapshot of NKE's technical charts over the past couple of months:

If you are just starting out, we recommend buying a deep ITM, January 23, 2023 LEAPs option. Because it's deep ITM, there is a high ratio of intrinsic value to extrinsic value, meaning that a great percentage of the option value is unable to be decayed away by Theta if the price of NKE were to stay the same from now until the expiration date.

Here are the stats of a Delta 0.80 LEAPs option you can consider purchasing:

Stock: NKE

Price: $140.72

Expiration Date: 2023-01-20

Type: Call

Delta: 0.80

Strike: $100

Investment: $5010

Once you purchase this LEAPs option, you can consider selling when NKE moves upwards $5. This means that the option value will theoretically rise from $5010 to around $5410. Why the $400 gain? It's because a Delta 0.80 multiplied by $5 is roughly around $400, considering all other variables equal. You can set a limit sell order on your brokerage to sell the LEAPs option at $5410. 💹

Please stay disciplined in buying just one LEAPs option to start off with, especially if you are new to all of this. We know it's tempting to get a little greedy and buy 20 LEAPs options at one shot. But if the markets get any bad news, your LEAPs options will go south very fast!

If you want to have more in-depth conversations about these advanced derivatives 🤓, feel free to chat with others in our Discord, or ask us questions in our Level 2 page.

Stay awesome! 😎

- 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.