The LEAP can be used as a surrogate instead of buying the actual stock. You can get a LEAP for about 30% of what the actual stock purchase would have cost you. With the B/A spread so high it is not a very good instrument for trading , as stated above. But if you want to use them as an income generator buy one a couple strikes ITM, then sell a current month call, one or two strikes OTM. I would only do this when the stock that I buy the LEAP for is at a Yearly low or at a major suport level. Did this a couple times and worked out.
PLEASE. PLEASE. The singular form of the term LEAPS is LEAPS. It it an acronym and that acronym is always 5-letter long. Long Term Equity AnticiPation Series Mark
Yes I sell insurance to scared investors, just doing my civic duty. I hedge by keeping a diversified portfolio of puts or calls (or both), and I am very careful about risk management and I carefully calculate the values of all contracts to squeeze out the most buck and give myself the most room to maneuver. I also have a large cash warchest, I do not use margin. Anyhow I was able to get my orders filled for one penny less it took about two hours to fill, I am real stingy and will try to squeeze that last penny out of the deal The last few trades ended up 4 cents higher after I bought to close. Anyhow options writing, think of it more from an actuary's perspective. More like selling auto insurance ie: GEICO etc..
I notice things like that too. For instance: Try FedEx Express (try Federal Express Express?) Order a PCB board (Order a Printed Circuit Board board) I need your vehicle's VIN number. (I need your vehicle's Vehicle Identification Number number)
You are right, of course, but why care so much? The very need for the distinction between LEAPS and non-LEAPS options is due to the almost comical brokenness of the present symbology. With any luck (or maybe A LOT of luck ), they will have it fixed within a year or two. http://www.theocc.com/initiatives/symbology/default.jsp
I do think of it from an "actuary perspective " but still wonder how you are capable of evaluating risk besides diversifying your portfolio.