Sunday, October 18

LEAPS

MSFT at $526.83· calls 365+ days out· cash at 4.5%· margin benchmark 9.0%

Expiry

Selected: $175 call · Dec 17 '27 · $360.75 per share. Pick another from the ladder below.

Capital

$36,075

vs $52,683 for 100 shares

Frees up

$16,608

32% of the share cost

Exposure

100 sh

1.5× per dollar

Max loss

$36,075

the whole premium, below $175

What the leverage costs

Time value

$891.84

1.7% of spot, over 1.2y

Dividends forgone

—

no yield data

Implied borrow rate

4.6%

cash earns 4.5% · margin 9.0%

Net carry

$21.62

time value + dividends − interest earned

Above $175 this call trails 100 shares by a flat $21.62 however far the stock runs — both positions gain a dollar per dollar up there, so the gap never closes. That fixed amount is what you pay to cap the downside at $36,075 and keep $16,608 in cash. Below $174.78 the call is ahead, because its loss stops at the premium while the shares keep falling.

At expiry · Dec 17 '27

breakeven $535.75 · +1.7% from spot

Both lines include what a payoff diagram usually drops: dividends credited to the shares, and interest on the cash the call doesn’t tie up.

Strikes · Dec 17 '2749 of 93

Strike	Premium	Time value	Δ-shares	Borrow rate	Cost / exposure	Breakeven	P(ITM)
$175	$360.75	$8.92	100	4.6%	1.5%	$535.75+2%	43%
$180	$356.25	$9.42	100	4.7%	1.5%	$536.25+2%	43%
$185	$351.25	$9.42	100	4.6%	1.5%	$536.25+2%	44%
$190	$346.75	$9.92	100	4.7%	1.6%	$536.75+2%	44%
$195	$342.25	$10.42	100	4.8%	1.7%	$537.25+2%	43%
$200	$337.50	$10.67	99	4.8%	1.7%	$537.50+2%	43%
$210	$328.00	$11.17	99	4.8%	1.8%	$538.00+2%	44%
$220	$318.75	$11.92	99	4.9%	2.0%	$538.75+2%	44%
$230	$309.50	$12.67	99	5.0%	2.1%	$539.50+2%	44%
$240	$300.50	$13.67	99	5.2%	2.3%	$540.50+3%	44%
$250	$291.25	$14.42	98	5.3%	2.4%	$541.25+3%	44%
$260	$282.25	$15.42	98	5.4%	2.6%	$542.25+3%	44%
$270	$273.00	$16.17	98	5.5%	2.7%	$543.00+3%	44%
$280	$264.00	$17.17	97	5.6%	2.9%	$544.00+3%	44%
$290	$255.25	$18.42	97	5.8%	3.1%	$545.25+3%	44%
$300	$246.25	$19.42	96	5.9%	3.3%	$546.25+4%	44%
$310	$237.50	$20.67	95	6.1%	3.5%	$547.50+4%	44%
$320	$228.75	$21.92	95	6.3%	3.8%	$548.75+4%	43%
$330	$220.00	$23.17	94	6.5%	4.0%	$550.00+4%	43%
$340	$211.80	$24.97	93	6.8%	4.4%	$551.80+5%	43%
$350	$203.50	$26.67	92	7.1%	4.7%	$553.50+5%	43%
$360	$195.02	$28.19	91	7.3%	5.0%	$555.03+5%	43%
$370	$187.30	$30.47	90	7.7%	5.5%	$557.30+6%	42%
$380	$179.85	$33.02	89	8.2%	6.1%	$559.85+6%	42%
$390	$171.68	$34.84	88	8.4%	6.5%	$561.68+7%	41%
$400	$164.30	$37.47	86	8.9%	7.1%	$564.30+7%	41%
$410	$156.50	$39.67	85	9.2%	7.6%	$566.50+8%	41%
$420	$149.25	$42.42	83	9.6%	8.3%	$569.25+8%	40%
$430	$141.83	$44.99	82	10.0%	9.0%	$571.83+9%	40%
$440	$135.43	$48.59	80	10.7%	9.9%	$575.43+9%	39%
$450	$129.33	$52.49	78	11.3%	10.9%	$579.33+10%	38%
$460	$122.90	$56.07	76	11.9%	12.0%	$582.90+11%	38%
$470	$116.38	$59.54	75	12.5%	13.0%	$586.38+11%	37%
$480	$110.30	$63.47	73	13.1%	14.2%	$590.30+12%	36%
$490	$104.35	$67.52	71	13.7%	15.6%	$594.35+13%	36%
$500	$98.33	$71.49	69	14.3%	17.0%	$598.33+14%	35%
$505	$95.73	$73.89	68	14.7%	17.8%	$600.73+14%	34%
$510	$93.48	$76.64	67	15.2%	18.8%	$603.48+15%	34%
$515	$90.45	$78.62	66	15.5%	19.5%	$605.45+15%	34%
$520	$88.28	$81.44	65	15.9%	20.6%	$608.28+15%	33%
$525	$85.88	$84.04	64	16.4%	21.6%	$610.88+16%	33%
$530OTM	$82.85	$82.85	63	—	21.6%	$612.85+16%	32%
$535OTM	$81.28	$81.28	61	—	21.6%	$616.28+17%	32%
$540OTM	$78.75	$78.75	60	—	21.3%	$618.75+17%	31%
$545OTM	$76.15	$76.15	59	—	20.9%	$621.15+18%	31%
$550OTM	$73.53	$73.53	58	—	20.6%	$623.53+18%	30%
$555OTM	$71.78	$71.78	57	—	20.4%	$626.78+19%	30%
$560OTM	$69.95	$69.95	56	—	20.3%	$629.95+20%	29%
$565OTM	$68.15	$68.15	55	—	20.1%	$633.15+20%	29%

Borrow rateis the annualised cost of controlling the shares through the option, quoted against the capital it frees. It’s blank out of the money, where the call isn’t standing in for the shares at all. Cost / exposuredivides the same cost by the delta-weighted exposure it actually buys, so every strike is comparable — that’s the column to rank by.