ZYX is currently trading at 50-1/2 and a ZYX LEAPS call option, with a two-year expiration and a strike price of 50, is trading for a premium of 8 1/2, or $850 per contract. The investor buys five contracts for a total cost of $4250. The calls give the investor the right to buy 500 shares of ZYX between now and expiration at $50 per share regardless of how high the price of the stock rises. To be profitable, though, at expiration at $50 per share regardless of how high the price of the stock rises. To be profitable, though, at expiration, the stock must be trading for more than 58, the total of the option premium (8 1/2) and the strike price of 50. This is known as the breakeven point. The buyer's maximum loss for this strategy is equal to the total cost of the options, or $4250. The following are possible outcomes of this strategy at expiration.