Options Trader Makes Case For Amazon LEAP Call Strategy
Jason Luongo lays out a long-dated $250 call on Amazon expiring January 2028 as leveraged exposure, citing AWS growth of 37%, a $496B backlog and custom chip revenue. He includes a standard risk disclaimer that the premium can be entirely lost.
Original post · 2 min read
You could buy 100 shares of $AMZN right now for about $25,800.
Or you could buy the $250 call LEAP expiring January 2028 for about $5,400. Leveraged exposure to 100 shares. ~79% less capital. Over 480 days of runway.
The trade:
Strike: $250
Expiration: January 21, 2028
Premium: ~$54 per contract
Breakeven: $304
If $AMZN hits $320, this LEAP returns ~30%
If $AMZN hits $360, this LEAP returns ~104%
If $AMZN hits $400, this LEAP returns ~178%
100 shares at $400 returns ~55%. The LEAP returns more than 3x that on a fraction of the capital.
Why I like the setup:
- Q2 revenue up 20% to $200.6B, operating income up to $27.5B from $19.2B a year ago
- AWS grew 37% to $42.2B, its fastest growth in 18 quarters
- AWS backlog sits at $496B, up from $364B the prior quarter
- Custom chip business now runs above $25B a year, growing triple digits, with Anthropic and OpenAI both committed to Trainium for multiple gigawatts
- Advertising up 26% year over year
- Stock is about 10% below its August high, and next earnings are expected in late October
- 487 days of runway gives this trade time to work through short-term noise
The max you can lose on a LEAP is the entire premium you paid. In this case, that's $5,400 per contract. LEAPs are leveraged and can lose value quickly if the stock drops or stays flat. Only size this so you're comfortable losing all of it.
Note: LEAPs are one tool inside a broader portfolio. Owning shares is always the primary use of capital. This is a selective add-on for high-conviction moments when conditions align.
NFA DYOR
Or you could buy the $250 call LEAP expiring January 2028 for about $5,400. Leveraged exposure to 100 shares. ~79% less capital. Over 480 days of runway.
The trade:
Strike: $250
Expiration: January 21, 2028
Premium: ~$54 per contract
Breakeven: $304
If $AMZN hits $320, this LEAP returns ~30%
If $AMZN hits $360, this LEAP returns ~104%
If $AMZN hits $400, this LEAP returns ~178%
100 shares at $400 returns ~55%. The LEAP returns more than 3x that on a fraction of the capital.
Why I like the setup:
- Q2 revenue up 20% to $200.6B, operating income up to $27.5B from $19.2B a year ago
- AWS grew 37% to $42.2B, its fastest growth in 18 quarters
- AWS backlog sits at $496B, up from $364B the prior quarter
- Custom chip business now runs above $25B a year, growing triple digits, with Anthropic and OpenAI both committed to Trainium for multiple gigawatts
- Advertising up 26% year over year
- Stock is about 10% below its August high, and next earnings are expected in late October
- 487 days of runway gives this trade time to work through short-term noise
The max you can lose on a LEAP is the entire premium you paid. In this case, that's $5,400 per contract. LEAPs are leveraged and can lose value quickly if the stock drops or stays flat. Only size this so you're comfortable losing all of it.
Note: LEAPs are one tool inside a broader portfolio. Owning shares is always the primary use of capital. This is a selective add-on for high-conviction moments when conditions align.
NFA DYOR
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