How I Use LEAPS Call Options To Retire Early (Full Masterclass) | Options With Ryan

About this video

• Video Title: How I Use LEAPS Call Options To Retire Early (Full Masterclass)
• Channel: Options With Ryan
• Speakers: Ryan
• Duration: 00:25:38

Overview

This video is a masterclass by Ryan on how to successfully trade LEAPS (Long-Term Equity Anticipation Securities) call options. He explains the strategy he uses, which he claims has generated hundreds of thousands of dollars for him, and shares his personal rules for selecting stocks, entering trades, and exiting with profits.

Key takeaways

• LEAPS Defined: LEAPS are call options with an expiration date of 365 days or more, offering more time for trades to become profitable compared to shorter-term options.
• Capital Efficiency & Leverage: LEAPS provide capital efficiency, allowing control of 100 shares with less capital than buying the shares directly, thus offering leveraged exposure.
• Pros of LEAPS: Benefits include capital efficiency, potential for higher returns on capital, and less time decay compared to short-term options.
• Cons of LEAPS: The main drawbacks are the premium paid for time and the leveraged nature of the product, which can lead to significant drawdowns.
• Technical Indicators: The video highlights Bollinger Bands (entering near the lower band for non-high beta stocks, or mid-band for high beta), RSI (entering when oversold or below 40), and MACD (waiting for the MACD line to cross above the signal line) as key indicators for entry signals.
• Trading Rules: Essential rules include the VIX being above 15, selecting upward-trending stocks with strong fundamentals and a PE ratio below 100, and entering trades when technical indicators align.
• Exit Strategy: Ryan advocates for taking quick profits (10-20% in under 7 days, or 20-40% in under 4 weeks) rather than holding for maximum gains, to mitigate risk and capitalize on multiple trading opportunities. He also advises closing positions 90 days before expiration to avoid significant time decay.