LEAPS: Why I’m Buying Time Instead of Stocks

Start of 2026, I was feeling pretty good. A bull year was what I had in mind — Fed rate cuts coming, AI capex finally showing up in earnings, deficit spending keeping growth alive. Things were looking okay.

Then the Iran war started on February 28. Kind of changed the mood a bit.

Oil is now sitting around $100. Core inflation re-accelerated to 3.1% in February. Q4 2025 GDP came in at 0.7% annualised — that’s pretty weak. I was already expecting the Fed to hold in early 2026, which they did on March 18, and only start cutting in H2 or Q4 at the earliest. The S&P 500 is about 5% below its January peak of just over 7,000 — lowest since November. VIX hit 28. Russell 2000 is down more than 8%. And yields are rising not because the economy is strong — but because inflation just won’t come down. Slow growth, sticky prices. Not a great combination.

I’m not saying it’s a bear market. Could just be a pullback. But the thing about bear markets is you never know you’re in one until a few months in. History shows the average drawdown takes 9 to 17 months to bottom out — and getting back to new highs takes even longer. VIX elevated, small-caps leading the fall, Fed stuck with rates while inflation stays sticky — the signs are there.

I’m still bullish on GOOGL, AMZN and PLTR. That part hasn’t changed. What changed is my confidence in the near-term. We’re one month into a war and nobody knows where this goes. A deeper correction, maybe even a recession, is on the table. If that happens these stocks could fall a lot more from here. Buying shares now means I ride the full drawdown with no protection — and I genuinely don’t know where the floor is.

So I bought LEAPS instead. Not because I’ve lost faith in the companies. But because I didn’t want to lock up full capital before the dust settles. My downside is capped at $28,155 — the premium I paid — no matter how far markets fall. The other $85,206 I kept free, and it went into healthcare and industrials where my thesis is more near-term and I’m more comfortable with the entry. If we do get a proper correction and tech comes down further, I have the cash to add at better prices.

By 2027 and 2028, I think most of this noise will have cleared. The destination still looks right. It’s the journey I’m less sure about.

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What is a LEAPS?

A LEAPS is just a long-dated call option. Same as a normal call option, but expiring 1 to 3 years out instead of weeks or months.

You pay a premium upfront for the right to buy a stock at a fixed price — the strike price — any time before expiry. My PLTR $150 call, for example, gives me the right to buy PLTR at $150 per share all the way until January 2028. If PLTR goes to $250, I can still buy at $150. If it never crosses $150 and expires worthless, I lose only the premium. That’s it. Downside is fixed the moment you buy, no margin calls, no forced selling.

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My positions — and why not just buy the shares?

5 LEAPS across GOOGL, AMZN and PLTR. Total premium paid: $28,155. That’s the worst case — every single cent gone.

The obvious question is why not just buy the shares. So here’s the comparison — 100 shares of each instead, at the opening price on each trade date.

LEAPS P/L as of 16 March 2026. Open price is the opening price on each trade date. Hypothetical share position = 100 shares per contract.

Same directional exposure — but LEAPS required $85,206 less cash upfront, with downside capped at the premium paid.

A couple of things to note.

Yes, the shares are doing slightly better in dollar terms right now — down $531 vs my LEAPS down $1,036. That’s the trade-off with LEAPS — if the stock runs hard, you’d make more in absolute dollars holding shares. Fair. But I got the same directional exposure for $28,155 instead of $113,361. That’s $85,206 sitting somewhere else working for me, and right now that cash buffer matters.

Also don’t compare the percentages between LEAPS and shares directly — a 29% loss on a $7,450 premium is a very different thing from a 29% loss on $33,441 of shares. The base numbers are completely different. I only show the individual percentages so you can see how each stock moved.

And if markets fall another 20% in H2? My LEAPS lose value, yes — but I still can’t lose more than $28,155. Someone holding $113,361 of shares could lose a lot more than that.

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The case for each position

You might look at PLTR at $198 in December 2025, GOOGL at $334 in January, and think — aren’t you just waiting for prices to go back up?

Not exactly. In 2025, a lot of tech was priced on speculation — the market was paying for growth that hadn’t fully arrived yet. That corrected in early 2026 when SaaS-AI fears triggered a big rotation out of tech. But the actual businesses? Still growing. PLTR revenue up 70%, GOOGL Cloud up 48%, AWS up 24%. The fundamentals didn’t break. The speculation did.

By 2027/2028, I think earnings will have grown into those prices. What looked expensive at $198 for PLTR in 2025 could look reasonable at $198 in 2027 — not because the price went up, but because the business got bigger and caught up with the valuation. That’s what I’m actually betting on. Not a return to 2025 hype, just 2025 prices becoming fair value by 2027/2028.

One thing I want to explain before going into each position — why I focus on breakeven rather than strike price.

Strike price is the price I have the right to buy at. But just hitting the strike doesn’t mean I’ve made money — I also need to recover the premium I paid. So the number that actually matters is strike plus premium per share. Below that at expiry, I’d have been better off just buying the shares outright.

Say a call costs $48 per share in premium with a $150 strike. The stock needs to hit $198 before you break even. If it’s at $180 at expiry, you can technically exercise and buy at $150 — but your effective cost is $198. You haven’t made anything.

Here’s the breakeven for each position:

Position	Strike	Premium/share	Breakeven	Current (16 Mar)	Move Needed
GOOGL Dec 2027 $310 C	$310	$63.75	$373.75	$305.56	+22.3%
GOOGL Dec 2027 $340 C	$340	$74.50	$414.50	$305.56	+35.7%
AMZN Jan 2028 $210 C	$210	$47.10	$257.10	$211.74	+21.4%
PLTR Jan 2028 $150 C	$150	$48.00	$198.00	$152.72	+29.6%
PLTR Jan 2028 $150 C	$150	$48.20	$198.20	$152.72	+29.8%

One more thing — the P/L in the first table shows how much the option’s market value has moved since I bought it, which is different from breakeven. The GOOGL $310 call is showing a small gain right now because the option gained value as the stock moved — but that doesn’t mean I’ve broken even. Breakeven is what matters if I hold to expiry. As expiry gets closer, the option’s market price converges with the actual stock price versus the strike, and anything above breakeven at that point is profit.

GOOGL — the two calls are quite different stories.

The $310 call I bought in March after the pullback, when GOOGL was at $303. Breakeven is $373.75, and to get there I don’t need the market to get more excited about Google — just earnings growing while the valuation stays roughly where it is today. Feels achievable.

The $340 call, I’m less sure about. Bought in January when GOOGL was at $334 — caught the tail end of a run up, then it sold off. Breakeven is $414.50, above the all-time high of $349. So not just waiting for a recovery — need the stock to go where it’s never been. Honestly the odds are not great.

But I’m not selling. Only a few months in, still 21 months left, and earnings are still growing with Waymo still expanding. The war didn’t break anything in the business. Closing now just locks in the loss with no chance of coming back — I’d rather wait and see. I’ll cut if something actually breaks.

What I’m keeping an eye on: whether Google Cloud and Waymo start showing real returns from the $175-185 billion capex planned for 2026 — nearly double the $91 billion spent in 2025. That capex was what spooked the market after Q4 results. Q4 itself was fine — revenue up 18%, Cloud up 48%. The foundation is there. The capex overhang is the thing to watch.

AMZN — I’ve held AMZN shares since October 2025, bought as an AI growth play and that view hasn’t changed. Q4 2025 was solid — AWS grew 24%, overall revenue up 14%. The selloff after earnings came from the capex guidance — $200 billion in 2026 spending, which the market read as near-term margin pressure. Stock sold off despite a good quarter.

I wanted more exposure to the recovery but didn’t want to add more shares into an uncertain market. Adding shares now means a bigger open-ended drawdown on top of what I already hold if things get worse. The LEAPS gives me the same incremental exposure with the downside capped at $4,710.

Breakeven is $257.10 by January 2028. AMZN’s earnings have been growing steadily — analysts are projecting solid growth through 2027, and even on a conservative estimate the stock would need to be around where it is today, maybe a bit higher. I don’t need a blowout quarter or a market re-rating. Just need the business to keep executing while the capex concerns fade.

PLTR — this one is the most aggressive of the three.

Even at a very generous valuation, PLTR needs to roughly double from here just to get me to breakeven. So I’m not betting on PLTR going back to $198 because the market gets excited again. I’m betting that by 2027, the business will have grown enough that $198 is actually a fair price — not hype, just earnings catching up. That’s the whole thesis.

PLTR keeps beating expectations though, and the business keeps growing. If that continues into 2027, the price starts to make sense on its own merits. High conviction, high risk. Eyes open.

Also why I didn’t put it all in at once — February at $157, then March after the pullback at $147. Bad timing with LEAPS hurts more than with shares because it eats straight into your premium. Two smaller entries helps with that. Funny enough the premiums came out almost identical — $4,800 and $4,820 — even though the entries were a month apart. Stock was lower in March but options had gotten more expensive by then, so it evened out. Worked out fine either way.

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Where I stand now

Premium is paid. That’s the most I can lose.

There are really three ways this plays out. If a position gains enough, I just sell the option and take the profit — most people do this, you don’t actually need to exercise. If GOOGL hits $375 for example, my $340 call would still have value even though that’s below the $414.50 breakeven at expiry — the stock would be above the strike, plus there’s still time value in it. No fixed price targets right now, it’s too early. My plan is to reassess around mid-2027 when time decay starts to accelerate — by then each company’s earnings picture should be a lot clearer. If I want to hold a stock long term beyond expiry, I could exercise instead — pay the strike price and convert to actual shares. If PLTR hits $300 for example, exercising the $150 call means buying 100 shares at $150 and I’m immediately sitting on $15,000 of unrealised gain. Cash for that could come from closing other positions that have done their job by then.

If a position is losing — two options. Thesis broken, I cut and recover whatever the option is worth. Thesis intact but needs more time, I roll — close the current LEAPS, open a new one with a later expiry. Rolling costs money since I’d be paying another premium, so only worth it if conviction is still high. A bad quarter alone won’t make me roll. The business actually breaking will.

Some will ask — what if 2027/2028 still isn’t better? Iran war drags on, credit stress, Taiwan situation. Fair concern. But expiry isn’t a deadline — it’s a checkpoint. If things deteriorate badly before then, I can close all five and recover whatever market value is left. Maximum loss remains $28,155 regardless. If the thesis is intact but needs more time, I can roll and extend the runway.

Otherwise I’m just watching. I bought time. Now I wait.

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Disclaimer: This is a personal blog sharing my investment thought process. It is not investment advice. Always consult a qualified financial advisor before making investment decisions.