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What are LEAPS options, in plain words?

LEAPS are long-term options that expire up to two years and eight months away 1. They are quoted and traded like any other listed option, with the same contract size, exercise and assignment 1. The difference is time: more of it costs more and, in the example below, each day takes a much smaller share of the price 2.

A $50 stock and two $50 calls at 30% implied volatility (made-up numbers): one with 30 days left, one with years. Move the long one's days.

Source: the StrikePath engine, pricing with the Black–Scholes formula 2 at 4.3% interest a year; a simulated example, not market prices. For learning; not advice.

In numbers

By the formula the two-year (730-day) $50 call costs $10.28 a share, against $1.80 for the 30-day one 2. A day passing takes about 3.1¢ from the 30-day call and about 0.8¢ from the two-year one 2: time value shrinks faster near expiry 3.

Moves the same way, a little more

The two-year call's delta is 0.66 against 0.53 for the 30-day one 2: it follows the stock a little more closely, for the higher price.

What this shows, and what it doesn't

Model prices for one strike and one volatility. Over two years implied volatility can change a lot, and the more time is left, the more vega an option has 4: a long option's price moves more with it than a short one's.

Go further

How much value does an option lose each day? →Time decay, day by day.How much does one option contract cost? →The quote times 100.
Sources (4), checked 20 October 2026 and 27 October 2026
  1. The Options Industry Council, “How LEAPS® Work”. Read it (read 27 October 2026)
  2. Fischer Black and Myron Scholes, “The Pricing of Options and Corporate Liabilities”, Journal of Political Economy 81(3), 637–654, 1973. Read it (read 20 October 2026)
  3. The Options Industry Council, “Theta”. Read it (read 20 October 2026)
  4. CME Group, “Options Vega – The Greeks” (Option Greeks course). Read it (read 27 October 2026)

Now try it on a scenario of your own

Pick where a simulated stock might be, and by when: drag one dot and see, side by side, what buying shares, one option, or a pair of options (a call or put spread) would each do. Free, no sign-up.

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