I am looking at buying LEAPS, and in particular, LEAPS verticals:
BUY +1 VERTICAL AMZN 100 JAN 13 180/220 CALL @13.50 LMT GTC
Break Even Stock Prices 193.50
Max Profit $2,650.00
Max Loss $1,350.00 (not including possible dividend risk)
Cost of Trade including commissions $1,350.00 + $5.90 = $1,355.90
The net delta of the position today is .20 (like owning 20 shares of AMZN), so in a way my per-share cost is $1,350.00 divided by 20 = 67.50. And ideally in late 2012 AMZN is above 193 and the spread is profitable.
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