Long calls are perfect for betting on an asset’s future upside price movement, though I would argue that time is the better asset when it comes to buying options contracts. Without enough time untill expiration, even a massive upward price movement will only generate intrinsic value - if the option is in-the-money.

As a result, calls with longer time horizons tend to perform better than those that are shorter dated.

Today, I'd like to share a few examples based on one of my favorite stocks, NVIDIA Corp. (NVDA). 

Long Call Basics

Calls are contracts that give the buyer the right but not the obligation to buy a specified asset at a specific strike price at or before the expiration date. But if you boil it down to its very basics, at least in terms of how most trades make money off of them, a long call is a leveraged bet on the stock moving up before your expiration date. 

Since option contracts are time-bound, a portion of their value is derived from the remaining days to expiration, also known as DTE. This concept is commonly referred to as the time value. 

The time value decreases as the expiration date approaches, and it decreases faster as the option gets closer to expiration - a phenomenon known as time decay. That’s great news for option sellers, but not much for option buyers. Having more time on the clock means your bet has more time to work in your favor. That extra breathing room can make all the difference between a winning trade and a frustrating loss. 

Introduction to Delta

Delta is the options Greek that indicates the relationship between the option’s value or premium and the asset’s price, or, more exactly, how much an option’s premium is expected to change for every $1 move in the price of the underlying asset.

Long calls have positive delta. Therefore, if a long call has a 0.20 delta, the premium is expected to increase by 20 cents for every $1 increase in the underlying asset. 

More interestingly, delta is often used as a shorthand predictor of the probability of the option expiring in the money. The same 0.20 delta option has a 20% chance of expiring in the money. While it’s not a 100% accurate predictor, delta is based on factors that include how close the option is to the current stock price, which makes it a good indicator of risk. 

NVDA Long Calls

Now, let’s dive into Barchart’s Option Screener and get long call recommendations for NVDA. To find those, simply go to Barchart.com, go to Nvidia’s profile page, and click Long Call/Put under Option Strategies on the left navigation bar. 

Once there, you’ll see a list of suggested options trades. The first thing I like to do is change the expiration date to somewhere between five and six months from today. For this example, let’s use December 19, 2025, which is 174 days away from the expiration date. 

For the sake of comparison, I’ll choose three examples from the selection based on three delta values: 0.20, 0.50, and 0.80. 

First Trade Example

I’ll use the first trade as an example.

According to the screener, you can buy this 210-strike, 0.20-delta call on NVDA for $4.65 per share or $465 total, which expires on December 19. For reference, NVDA is trading at $157.75, which means this particular long call is over 33% out of the money (OTM). When we consider the net debit, NVDA would have to increase by more than 36% for the trade to start becoming profitable. 

This is reflected in its premium, which, considering the underlying is trading at $157.75, is relatively low. 

Second Trade Example

The next trade has a 0.50 delta, or about a 50% chance of expiring in the money. You can buy a 167-strike call on NVDA for $15.80 per share, or $1,580 total. The long call is roughly 6% out of the money. To break even, NVDA would have to increase by about 16%. 

Now, let’s compare the difference: 16% to breakeven vs 36% to breakeven makes quite the difference. However, the premium increased from $465 to $1,580 - or 240%. This gives us a good idea of how much more expensive it is to buy long-dated calls that are closer to the money. 

Third Trade Example

The last trade has 0.80 delta, or an 80% chance of expiring in the money. In this example, you can buy a 130-strike call for $37.35 per share or $3,735 total. 

On the surface, yes, this trade appears expensive. However, remember that this trade is already 18% in the money, and NVDA will only need to move by just 6% or just $9.60 for the trade to break even.

Choosing The Right Trade For You

Bottom line, how you trade options depends on your risk tolerance and personal preferences. For some, a 0.20-delta call is a bit like a lottery ticket: high risk, high reward. Others may prefer a more modest trade, such as the 0.50 delta call earlier. The point is, there is no one-size-fits-all strategy in options trading.

However, there are ways to find the right trade for your specific needs. With Barchart, you can access the new P&L Charting tool, which provides a quick yet in-depth visual and numerical reference for key metrics and indicators. You can access the feature by clicking on the charting icon between the price and expiration dates, or by clicking the Profit/Loss Chart button at the top of the results: 

From there, you’ll have access to five useful tabs: 

• P&L Tab: Interactive profit/loss chart with trade breakdown, breakeven, moneyness, and probability of profit.
• Greeks Tab: Displays all key Greeks relevant to the chosen strategy.
• Expected Move Tab: Projects price range using straddles; overlays past price action, earnings, and volatility.
• Volatility Tab: Displays IV, IV Rank, and IV Percentile to evaluate option pricing, along with short-term volatility trends.
• Trends Tab: Uses moving averages, RSI, ATR, and Trend Seeker to gauge momentum; includes visual trend indicators.

With a wealth of information at your fingertips and the freedom to cycle through the recommended trades with a click of a button, you can now choose your desired long call trade that fits your exact preferences. But if that’s not enough, you can go to Barchart’s Long Call Screener tool to access dozens of option and stock analysis filters for a further granular screen for your preferred trade.  

Final Thoughts

It doesn’t matter if you prefer high-risk, high-reward trades or opt for safer, more reliable options for longer-dated calls. Barchart’s suite of option and stock analysis tools gives you access to all the information you might ever need for trading. Find assets, filter using Greeks, personalize every aspect of your options trade - it’s all right there, ready to give you a 360-degree view of your trade, even before you open to buy your position.