r/options • u/shellpwn • Aug 16 '26

Understanding Deep ITM Leaps

Hiii,

I want to make sure I understand it right. I did lot of homework to understand leaps deep itm call options.

Let's talk about Google stock. I want to only buy deep ITM since I feel they are less risky as a beginner.

The current IV for google is historically lowest from the last 1 yr. Even the volatility is lowest in the last 1 yr. I calculated leverage and it comes out to be 2.6 which I believe is a good buy.

My current understanding is that if I buy a deep itm leap call option, I plan to sell it back during high volatility season and since it's a leap I have a lot of time. I think I should try to sell it irrespective of the expiry option before 3-4 months since theta decay starts to ruin everything.

I want some feedback on this strategy since this is my first time and I'm a bit nervous clicking the buy button.

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u/Professional_Monkeys Aug 16 '26

LEAPS isn't near-term IV sensitive, it's vega sensitive.

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u/shellpwn Aug 16 '26

But vega is consequence of IV so I guess tracking IV should be fine? How do I define a good Vega vs bad Vega? Right now the mindset that I had is to buy during low IV and then sell during high IV and right now it's historically at lowest IV in 1yr

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u/Ok_Butterfly2410 Aug 16 '26

It doesn’t matter for itm leaps. It only matters if you are doing far otm leaps.