UNDERLYING-FIRST · FIVE FILTERS · SEPARATE SCANNER
LEAPS Stock Evaluation
First find a quality business in a long-term uptrend, near a weekly stochastic turn, with reasonable valuation and low implied volatility. Only then choose a liquid 18–30 month call with at least 0.70 delta.
1 · Uptrend20%Price above rising 40-week average
2 · Weekly stochastic15%Near 20–35 and turning upward
3 · Business quality25%Cash flow, growth, margins and debt
4 · Valuation/upside25%Not overpriced · ≥15% upside
5 · Low implied volatility15%Low chain percentile and fair IV
Best underlying stocks for LEAPS
Five filters rank the stock and entry. Contract eligibility is checked afterward: 540–915 DTE, delta ≥0.70 and acceptable liquidity.
| RANK | DECISION | UNDERLYING | UPTREND · 20% | WEEKLY STOCH · 15% | QUALITY · 25% | VALUATION · 25% | LOW IV · 15% | ELIGIBLE CONTRACT | COST / LIQUIDITY | SCORE |
|---|
A Buy candidate must pass all five filters plus the contract gate. Weekly trend and stochastic use Yahoo price history; business quality and fair value use available FMP data. Yahoo option quotes are delayed—verify every bid/ask and delta in IBKR before trading. IV percentile is relative to the scanned long-dated chain, not a 52-week IV Rank.