LEAPS

Has anyone heard of Long-term Equity Anticipation Securities (LEAPS) and are they listed & traded on ASX.

They are, apparentley, a longer term option trading strategy. When would you use them?

 

I am not sure but I don't think LEAPS are listed on ASX.

Let's Talk About LEAPS: Options For The Long Term | Intermediate | Options Education | Trading & Technology | The Options Insider

 

Thanks Tropo, I couldn't find anything to do with them at ASX either.

It seems they are more an American derivative, probably due to the larger market there.

 

No LEAPS don't exist for the Australian Market... They are a US instrument.

The closest alternative would be LEPO's But even then they are not the same.

ASX Low Exercise Price Options

Is there a strategy that you particularly want LEAPs for?


DaveJ

 

I thought Warrants were the closest thing we had to LEAPS.

 

Hi Stig,

Warrants are OTC and Options are ET on maturity.

Apparently these LEAPS can be either...

On the Chicago Board of Exchange, they say they are basically long term options.

Long-term Equity AnticiPation Securities (LEAPS) and Equity LEAPS Specifications

Cheers,

Dan

 

Hi Dan, I know what LEAPS are in the US, but I was of the opinion that the closest thing we had to a long term option that wasted, was a Warrant.

I haven't traded a warrant for nearly 10 years so my knowledge of warrants is a bit rusty. But I basically thought they were a long term option that were traded with the issurer (OTC). Long term meaning longer than 9 months. Yeah?

 

Hi Stig,

Warrants are only OTC as they are issued only by a third party.

Options can either be issued by the exchange or by a third party, hence being both these would be similar to LEAPS...

"Equity LEAPS®
Long Term Equity Anticipation Securities (LEAPS) are long term options available on approximately 450 equities and 10 indexes. LEAPS provide investors with a longer term view of the market as a whole or on an individual stock. As with traditional short term options, LEAPS are available in two types, calls and puts."

from Equity LEAPS Specifications

With the full potential time of decay, warrants are similar.

I guess as there is no exact match that we have, the LEAPs are somewhere in between a few (possibly Endowment Warrants which had a 10 year expiry).

Cheers,

Dan

 

Thanks for all the comments and the usefull information you all have given me.

At least I know there are instuments on the ASX & in Australia that can be used in a similar fashion to LEAPS.