OK to Buy KO Leaps +315% Better

Based on +25% stock price in 1 year:
LEAPS ROI = 181.65%, Margin ROI = 43.75%
LEAPS are 315% more profitable than Margin.
LEAPS Premium = 10.13% of Stock Price.

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

LEAPS vs. Margin Comparison for KO

Stock Price: $78.4695
Option Symbol: KO280121C00080000
Option Expiry: 2028-01-21
Days to Expiration: 597 days
Strike Price: $80
Option Premium: $7.95
Live Delta: 0.6225
LEAPS Leverage: 6.14x
LEAPS Breakeven: $87.95 +12.1%
LEAPS Premium: 10.1%
Additional Greeks:
Gamma: 0.023
Theta: -0.0095
Vega: 0.3816
Rho: 0.6652
Implied Volatility: N/A
Open Interest: 1,016
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Scenario Comparison

Initial Investment: $795.00
Exit Strategy: Sell After 1 Year
LEAPS Gain = Intrinsic Value + Time Value
232 Time Value Days Remaining
Stock MoveNew PriceLEAPS GainLEAPS ROIMargin GainMargin ROI
50%$117.7$3,405.82428.40%$740.1793.10%
25%$98.09$1,444.08181.65%$347.8243.75%
10%$86.32$267.0433.59%$112.4114.14%
0%$78.47$-364.61-45.86%$-44.53-5.60%
-10%$70.62$-364.61-45.86%$-201.47-25.34%
-25%$58.85$-364.61-45.86%$-436.87-54.95%
-50%$39.23$-364.61-45.86%$-829.22-104.30%
Stock Move: 50%
New Price: $117.7
Intrinsic Value: $3770.43
LEAPS Gain: $3,405.82
LEAPS ROI: 428.40%
Margin Gain: $740.17
Margin ROI: 93.10%
Stock Move: 25%
New Price: $98.09
Intrinsic Value: $1808.69
LEAPS Gain: $1,444.08
LEAPS ROI: 181.65%
Margin Gain: $347.82
Margin ROI: 43.75%
Stock Move: 10%
New Price: $86.32
Intrinsic Value: $631.65
LEAPS Gain: $267.04
LEAPS ROI: 33.59%
Margin Gain: $112.41
Margin ROI: 14.14%
Stock Move: 0%
New Price: $78.47
Intrinsic Value: $0
LEAPS Gain: $-364.61
LEAPS ROI: -45.86%
Margin Gain: $-44.53
Margin ROI: -5.60%
Stock Move: -10%
New Price: $70.62
Intrinsic Value: $0
LEAPS Gain: $-364.61
LEAPS ROI: -45.86%
Margin Gain: $-201.47
Margin ROI: -25.34%
Stock Move: -25%
New Price: $58.85
Intrinsic Value: $0
LEAPS Gain: $-364.61
LEAPS ROI: -45.86%
Margin Gain: $-436.87
Margin ROI: -54.95%
Stock Move: -50%
New Price: $39.23
Intrinsic Value: $0
LEAPS Gain: $-364.61
LEAPS ROI: -45.86%
Margin Gain: $-829.22
Margin ROI: -104.30%

Equal Capital Projection


Based on +25% stock price in 1 year.
Total Capital Used: $795.00
Projected Stock Price (+25%): $98.09
LEAPS Gain: $1,444.08 | ROI: 181.65%
Margin Gain: $347.82 | ROI: 43.75%
LEAPS returned 315% more gains than Margin.

Based on +50% stock price in 1 year.
Total Capital Used: $795.00
Projected Stock Price (+50%): $117.7
LEAPS Gain: $3,405.82 | ROI: 428.4%
Margin Gain: $740.17 | ROI: 93.1%
LEAPS returned 360% more gains than Margin.

Based on -25% stock price in 1 year.
Total Capital Used: $795.00
Projected Stock Price (-25%): $58.85
LEAPS Gain: $-364.61 | ROI: -45.86%
Margin Gain: $-436.87 | ROI: -54.95%
LEAPS lost 17% less than Margin.

Based on -50% stock price in 1 year.
Total Capital Used: $795.00
Projected Stock Price (-50%): $39.23
LEAPS Gain: $-364.61 | ROI: -45.86%
Margin Gain: $-829.22 | ROI: -104.3%
LEAPS lost 56% less than Margin.
Power User Breakdown
Based on +25% stock price in 1 year.
Contract Expiration: 2028-01-21 (597 days total)
Days Remaining After 1 Year: 232 days
Option Premium: $7.95
Initial Stock Price: $78.47
Strike Price: $80.00
Projected Stock Price (+25% in 1 Year): $98.09
Price Difference (Projected - Strike): $18.09
Total Capital Used: $795.00
LEAPS Gain Components (Sell After 1 Year):
Intrinsic Value: $1,808.69
Time Value Remaining: $430.39
Total LEAPS Value: $2,239.08
Initial LEAPS Cost: $795.00
Total LEAPS Gain: $1,444.08
Margin Gain Components (Sell After 1 Year):
Shares Bought: 20
Total Stock Cost: $1,569.39
Borrowed Amount: $774.39
Interest Paid: $44.53
Total Margin Gain: $347.82
LEAPS vs. Margin Comparison:
LEAPS ROI: 181.65%
Margin ROI: 43.75%
LEAPS Gain: $1,444.08
Margin Gain: $347.82
LEAPS Gain Advantage: +$1,096.26
LEAPS returned 315% 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.