List of stocks that is good for LEAPS

Screening Filters

1. Beta: ['ModerateRisk']

   • Purpose: To identify stocks with moderate volatility.
   • Rationale: LEAPS (Long-term Equity Anticipation Securities) are long-term options, and moderate-risk stocks are generally more stable, reducing the likelihood of extreme price swings that could negatively impact the value of the LEAPS. This filter ensures the stocks selected are not excessively volatile, making them more suitable for long-term strategies.

2. P/E TTM (Price-to-Earnings, Trailing Twelve Months): {'max': '20'}

   • Purpose: To focus on stocks that are reasonably valued.
   • Rationale: A P/E ratio below 20 indicates that the stock is not overly expensive relative to its earnings. For LEAPS, it is important to target stocks with solid fundamentals and reasonable valuations, as overvalued stocks may face downward pressure over the long term, which could negatively impact the LEAPS.

3. EPS 5-Year CAGR (Earnings Per Share 5-Year Compound Annual Growth Rate): {'min': '10'}

   • Purpose: To identify stocks with strong historical earnings growth.
   • Rationale: LEAPS benefit from stocks with consistent and strong earnings growth, as this often leads to price appreciation over time. A minimum EPS growth rate of 10% ensures that the selected stocks have demonstrated solid performance and growth potential, which aligns with the long-term nature of LEAPS.

4. Dividend Yield TTM (Trailing Twelve Months): {'min': '2'}

   • Purpose: To include stocks that provide a steady income stream through dividends.
   • Rationale: While dividends are not the primary focus for LEAPS, a minimum yield of 2% ensures that the selected stocks have a history of returning value to shareholders. This can be an indicator of financial stability and can provide an additional layer of security for long-term investors.

Why Results Match:

• The filters collectively focus on stocks that are fundamentally strong, reasonably valued, and exhibit moderate risk, making them suitable candidates for LEAPS.
• Moderate-risk stocks with strong earnings growth and reasonable valuations are more likely to appreciate over the long term, which aligns with the goals of LEAPS investors.
• Including a dividend yield filter ensures that the selected stocks have a track record of financial stability and shareholder returns, which adds an extra layer of confidence for long-term strategies.