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Why Are Deep ITM Options Often Used as a Synthetic Substitute for Holding the Underlying Asset?

Deep ITM call options are used as a synthetic substitute for holding the underlying asset because their Delta is very close to 1.0. This means their price movement closely tracks the underlying asset.

They offer similar directional exposure but often require less capital than buying the asset outright and can sometimes offer favorable tax treatment or leverage, depending on the jurisdiction and product structure.

What Is the Impact of High Leverage on the Frequency of Margin Calls?
How Does the Moneyness of an Option Relate to Its Delta?
How Does the Concept of “Deep In-the-Money” Differ for Calls and Puts?
What Is the Primary Difference in Margin Calls between a Traditional Futures Contract and a Perpetual Swap?