Common Questions Regarding LEAPS

What are LEAPS?
Equity LEAPS, or Long-term Equity Anticipation Securities are long-dated put and call options on common stock or ADRs. These long-term options provide the holder the right to purchase, in the case of a call, or sell, in the case of a put, a specified number of stock shares at a pre-determined price up to the expiration date of the option, which can be three years in the future.

When do LEAPS expire? When can LEAPS be exercised?
As with equity options, the expiration date is the Saturday following the third Friday of the expiration month. All equity LEAPS contracts expire in the month of January. Equity options and Equity LEAPS are subject to "American style" exercise. This means the holder has the right to exercise the options on any business day prior to expiration.

How do I know when the next January expiring LEAPS will be listed?
All new January expiring equity LEAPS are initially listed on the first business day (usually a Monday) following the expiration in either May, June, or July each year. The month that the LEAP is initially listed in is dependent upon the quarterly cycle of the option. Cycle 1 options January expiring LEAPS are listed after the expiration in May, cycle 2 after the expiration in June, and cycle 3 after the expiration in July.

What are the trading hours for Equity LEAPS Options?
As with regular equity options, the trading hours for Equity LEAPS are from 8:30 a.m. to 3:02 p.m. Central Time (Chicago time).

Information taken from the Chicago Board of Options Exchange, CBOE.com