OK to Buy KO Leaps +212% Better

Based on +25% stock price in 1 year:
LEAPS ROI = 134.9%, Margin ROI = 43.27%
LEAPS are 212% more profitable than Margin.
LEAPS Premium = 11.29% of Stock Price.

LEAPS Premium is OK, under 40%
LEAPS outperform margin by at least 40%

LEAPS vs. Margin Comparison for KO

Stock Price: $81.675
Option Symbol: KO280121C00085000
Option Expiry: 2028-01-21
Days to Expiration: 552 days
Strike Price: $85
Option Premium: $9.22
Live Delta: 0.5787
LEAPS Leverage: 5.13x
LEAPS Breakeven: $94.22 +15.4%
LEAPS Premium: 11.3%
Additional Greeks:
Gamma: 0.023
Theta: -0.0103
Vega: 0.3932
Rho: 0.6021
Implied Volatility: N/A
Open Interest: 6,181
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Scenario Comparison

Initial Investment: $922.00
Exit Strategy: Sell After 1 Year
LEAPS Gain = Intrinsic Value + Time Value
187 Time Value Days Remaining
Stock MoveNew PriceLEAPS GainLEAPS ROIMargin GainMargin ROI
50%$122.51$3,285.67356.36%$848.1291.99%
25%$102.09$1,243.80134.90%$398.9143.27%
10%$89.84$18.672.03%$129.3814.03%
0%$81.68$-465.58-50.50%$-50.30-5.46%
-10%$73.51$-465.58-50.50%$-229.99-24.94%
-25%$61.26$-465.58-50.50%$-499.52-54.18%
-50%$40.84$-465.58-50.50%$-948.73-102.90%
Stock Move: 50%
New Price: $122.51
Intrinsic Value: $3751.25
LEAPS Gain: $3,285.67
LEAPS ROI: 356.36%
Margin Gain: $848.12
Margin ROI: 91.99%
Stock Move: 25%
New Price: $102.09
Intrinsic Value: $1709.38
LEAPS Gain: $1,243.80
LEAPS ROI: 134.90%
Margin Gain: $398.91
Margin ROI: 43.27%
Stock Move: 10%
New Price: $89.84
Intrinsic Value: $484.25
LEAPS Gain: $18.67
LEAPS ROI: 2.03%
Margin Gain: $129.38
Margin ROI: 14.03%
Stock Move: 0%
New Price: $81.68
Intrinsic Value: $0
LEAPS Gain: $-465.58
LEAPS ROI: -50.50%
Margin Gain: $-50.30
Margin ROI: -5.46%
Stock Move: -10%
New Price: $73.51
Intrinsic Value: $0
LEAPS Gain: $-465.58
LEAPS ROI: -50.50%
Margin Gain: $-229.99
Margin ROI: -24.94%
Stock Move: -25%
New Price: $61.26
Intrinsic Value: $0
LEAPS Gain: $-465.58
LEAPS ROI: -50.50%
Margin Gain: $-499.52
Margin ROI: -54.18%
Stock Move: -50%
New Price: $40.84
Intrinsic Value: $0
LEAPS Gain: $-465.58
LEAPS ROI: -50.50%
Margin Gain: $-948.73
Margin ROI: -102.90%

Equal Capital Projection


Based on +25% stock price in 1 year.
Total Capital Used: $922.00
Projected Stock Price (+25%): $102.09
LEAPS Gain: $1,243.80 | ROI: 134.9%
Margin Gain: $398.91 | ROI: 43.27%
LEAPS returned 212% more gains than Margin.

Based on +50% stock price in 1 year.
Total Capital Used: $922.00
Projected Stock Price (+50%): $122.51
LEAPS Gain: $3,285.67 | ROI: 356.36%
Margin Gain: $848.12 | ROI: 91.99%
LEAPS returned 287% more gains than Margin.

Based on -25% stock price in 1 year.
Total Capital Used: $922.00
Projected Stock Price (-25%): $61.26
LEAPS Gain: $-465.58 | ROI: -50.5%
Margin Gain: $-499.52 | ROI: -54.18%
LEAPS lost 7% less than Margin.

Based on -50% stock price in 1 year.
Total Capital Used: $922.00
Projected Stock Price (-50%): $40.84
LEAPS Gain: $-465.58 | ROI: -50.5%
Margin Gain: $-948.73 | ROI: -102.9%
LEAPS lost 51% less than Margin.
Power User Breakdown
Based on +25% stock price in 1 year.
Contract Expiration: 2028-01-21 (552 days total)
Days Remaining After 1 Year: 187 days
Option Premium: $9.22
Initial Stock Price: $81.68
Strike Price: $85.00
Projected Stock Price (+25% in 1 Year): $102.09
Price Difference (Projected - Strike): $17.09
Total Capital Used: $922.00
LEAPS Gain Components (Sell After 1 Year):
Intrinsic Value: $1,709.38
Time Value Remaining: $456.42
Total LEAPS Value: $2,165.80
Initial LEAPS Cost: $922.00
Total LEAPS Gain: $1,243.80
Margin Gain Components (Sell After 1 Year):
Shares Bought: 22
Total Stock Cost: $1,796.85
Borrowed Amount: $874.85
Interest Paid: $50.30
Total Margin Gain: $398.91
LEAPS vs. Margin Comparison:
LEAPS ROI: 134.90%
Margin ROI: 43.27%
LEAPS Gain: $1,243.80
Margin Gain: $398.91
LEAPS Gain Advantage: +$844.89
LEAPS returned 212% more gains than Margin.
LEAPS Risk to Reward Score
Good Risk to Reward
82/100
Base Performance Score: 80
Bonuses: 12
  • +7 (18-24 Month Expiration)
  • +5 (ATM Strike)
Penalties: 10
  • -10 (High Leverage)

Final Risk vs Reward Score: 82/100
Base Performance Score is based on how much better LEAPS perform than margin. It's calculated as (LEAPS ROI - Margin ROI) * 1.5, capped at 80.