Tuesday, September 21, 2010

LEAP stock Options?

What happens when you buy a plain stock option that is WAY far out of the money-but expires in 2-3 years? Is the quality for intrinsic value profitable? Say ABC stock shares trading up (2006) at $5.00 per share and buy a Call Option at $15.00 (Strike Price) that expires in 2008? Is this too far out of the money or not?