OK to Buy KO Leaps +307% Better

Based on +25% stock price in 1 year:
LEAPS ROI = 177.77%, Margin ROI = 43.64%
LEAPS are 307% more profitable than Margin.
LEAPS Premium = 10.16% of Stock Price.

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

LEAPS vs. Margin Comparison for KO

Stock Price: $80.1
Option Symbol: KO280121C00082500
Option Expiry: 2028-01-21
Days to Expiration: 689 days
Strike Price: $82.5
Option Premium: $8.14
Live Delta: 0.6037
LEAPS Leverage: 5.94x
LEAPS Breakeven: $90.64 +13.2%
LEAPS Premium: 10.2%
Additional Greeks:
Gamma: 0.0249
Theta: -0.008
Vega: 0.4244
Rho: 0.7738
Implied Volatility: N/A
Open Interest: 1,531
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Scenario Comparison

Initial Investment: $814.00
Exit Strategy: Sell After 1 Year
LEAPS Gain = Intrinsic Value + Time Value
324 Time Value Days Remaining
Stock MoveNew PriceLEAPS GainLEAPS ROIMargin GainMargin ROI
50%$120.15$3,449.57423.78%$755.6992.84%
25%$100.13$1,447.07177.77%$355.1943.64%
10%$88.11$245.5730.17%$114.8914.11%
0%$80.1$-315.43-38.75%$-45.31-5.57%
-10%$72.09$-315.43-38.75%$-205.51-25.25%
-25%$60.08$-315.43-38.75%$-445.81-54.77%
-50%$40.05$-315.43-38.75%$-846.31-103.97%
Stock Move: 50%
New Price: $120.15
Intrinsic Value: $3765
LEAPS Gain: $3,449.57
LEAPS ROI: 423.78%
Margin Gain: $755.69
Margin ROI: 92.84%
Stock Move: 25%
New Price: $100.13
Intrinsic Value: $1762.5
LEAPS Gain: $1,447.07
LEAPS ROI: 177.77%
Margin Gain: $355.19
Margin ROI: 43.64%
Stock Move: 10%
New Price: $88.11
Intrinsic Value: $561
LEAPS Gain: $245.57
LEAPS ROI: 30.17%
Margin Gain: $114.89
Margin ROI: 14.11%
Stock Move: 0%
New Price: $80.1
Intrinsic Value: $0
LEAPS Gain: $-315.43
LEAPS ROI: -38.75%
Margin Gain: $-45.31
Margin ROI: -5.57%
Stock Move: -10%
New Price: $72.09
Intrinsic Value: $0
LEAPS Gain: $-315.43
LEAPS ROI: -38.75%
Margin Gain: $-205.51
Margin ROI: -25.25%
Stock Move: -25%
New Price: $60.08
Intrinsic Value: $0
LEAPS Gain: $-315.43
LEAPS ROI: -38.75%
Margin Gain: $-445.81
Margin ROI: -54.77%
Stock Move: -50%
New Price: $40.05
Intrinsic Value: $0
LEAPS Gain: $-315.43
LEAPS ROI: -38.75%
Margin Gain: $-846.31
Margin ROI: -103.97%

Equal Capital Projection


Based on +25% stock price in 1 year.
Total Capital Used: $814.00
Projected Stock Price (+25%): $100.13
LEAPS Gain: $1,447.07 | ROI: 177.77%
Margin Gain: $355.19 | ROI: 43.64%
LEAPS returned 307% more gains than Margin.

Based on +50% stock price in 1 year.
Total Capital Used: $814.00
Projected Stock Price (+50%): $120.15
LEAPS Gain: $3,449.57 | ROI: 423.78%
Margin Gain: $755.69 | ROI: 92.84%
LEAPS returned 356% more gains than Margin.

Based on -25% stock price in 1 year.
Total Capital Used: $814.00
Projected Stock Price (-25%): $60.08
LEAPS Gain: $-315.43 | ROI: -38.75%
Margin Gain: $-445.81 | ROI: -54.77%
LEAPS lost 29% less than Margin.

Based on -50% stock price in 1 year.
Total Capital Used: $814.00
Projected Stock Price (-50%): $40.05
LEAPS Gain: $-315.43 | ROI: -38.75%
Margin Gain: $-846.31 | ROI: -103.97%
LEAPS lost 63% less than Margin.
Power User Breakdown
Based on +25% stock price in 1 year.
Contract Expiration: 2028-01-21 (689 days total)
Days Remaining After 1 Year: 324 days
Option Premium: $8.14
Initial Stock Price: $80.10
Strike Price: $82.50
Projected Stock Price (+25% in 1 Year): $100.13
Price Difference (Projected - Strike): $17.63
Total Capital Used: $814.00
LEAPS Gain Components (Sell After 1 Year):
Intrinsic Value: $1,762.50
Time Value Remaining: $498.57
Total LEAPS Value: $2,261.07
Initial LEAPS Cost: $814.00
Total LEAPS Gain: $1,447.07
Margin Gain Components (Sell After 1 Year):
Shares Bought: 20
Total Stock Cost: $1,602.00
Borrowed Amount: $788.00
Interest Paid: $45.31
Total Margin Gain: $355.19
LEAPS vs. Margin Comparison:
LEAPS ROI: 177.77%
Margin ROI: 43.64%
LEAPS Gain: $1,447.07
Margin Gain: $355.19
LEAPS Gain Advantage: +$1,091.88
LEAPS returned 307% 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.