An option which expires after more than a year (e.g. 1, 2 or 3 years). Traders buy long-dated options with concentration on implied volatility (i.e., they expect it to pick up in a period longer than normal (or commonly prevalent) maturities of options. At the end of its life, the option will be sold at a higher level of implied volatility. In general, the longer time would allow the option to move in a direction favorable to the buyer/ holder (as reflected in more profit opportunities than options with short maturities).
By nature, long-dated options have small gammas and large vegas.
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