What are equity leaps call options?

Equity LEAPS call options allow investors to benefit from potential rises in a specific stock while using less capital than purchasing shares with cash upfront. In other words, the cost of the premium for an option is lower than the cash needed to buy 100 shares outright.

How to buy a leaps call?

First, choose a stock. You should use exactly the same process you would use if purchasing the stock. After you have used whatever research tools you prefer to analyze the stock's fundamental sand have determined that you like it. Now, you need to pick your strike price. You want to buy a LEAPS call that is deep in-the-money.

Should you buy a leap call option instead of a stock?

Investors can purchase a LEAP call option contracts instead of shares of stock in order to get similar long-term investment benefits with less capital outlay. Substituting a financial derivative for a stock is known as a Stock Replacement strategy and is used to improve overall capital efficiency.