PMCC Workhorses (Primary Capital)
| Ticker | Why | LEAPS Profile | Short Call |
|---|
| Apple (AAPL) | Mean-reverting, enormous liquidity, forgiving rolls | Δ 0.75–0.85, low decay | Monthly 0.20–0.25 Δ |
| Microsoft (MSFT) | Stable uptrend, deep institutional options | Δ ~0.80 | Monthly 0.18–0.25 Δ |
| Amazon (AMZN) | Higher IV than peers, strong call demand | Δ 0.75–0.80 | Monthly 0.22–0.30 Δ |
| Alphabet (GOOGL) | Low drama, excellent diagonals | Δ ~0.80 | Monthly 0.18–0.25 Δ |
Role: Capital preservation + steady premium
Expected yield: ~2.8–3.3% monthly
Income Accelerators (Controlled Aggression)
Higher IV, more premium, more roll management.
| Ticker | Rationale | LEAPS Notes | Short Call |
|---|
| NVIDIA (NVDA) | Massive call demand, strong skew | Expensive but liquid | 0.20–0.30 Δ |
| Tesla (TSLA) | Persistent IV, constant premium | Wide LEAPS menu | 0.25–0.35 Δ |
| Meta Platforms (META) | High call activity, good diagonals | Solid long gamma | 0.22–0.30 Δ |
| Advanced Micro Devices (AMD) | AI-adjacent IV without meme behavior | Cheaper LEAPS | 0.25–0.30 Δ |
Role: Subsidize safer names
Expected yield: ~3.5–4.5% monthly
Income Accelerators (Controlled Aggression)
Lower yield, much higher survivability.
| Ticker | Rationale | LEAPS Behavior | Short Call |
|---|
| SPDR S&P 500 ETF Trust (SPY) | Ultimate liquidity, smooth rolls | Very slow decay | 0.12–0.20 Δ |
| Invesco QQQ Trust (QQQ) | Tech-weighted premium | Strong diagonals | 0.15–0.22 Δ |
| iShares Russell 2000 ETF (IWM) | Higher IV index sleeve | Faster theta | 0.18–0.25 Δ |
Role: Prevent portfolio-level blowups
Expected yield: ~2.2–2.8% monthly
Names Intentionally EXCLUDED (Important)
These look tempting but fail PMCC survivability tests:
• Small-cap high IV (poor LEAPS liquidity)
• Meme stocks (GME-like dynamics)
• Biotech (binary gap risk)
• Chinese ADRs (policy + liquidity risk)
• Commodity ETFs (contango + skew issues)
PMCCs require stability, not excitement.
LEAPS SELECTION RULE (Ticker-Agnostic)
For every ticker above:
• Expiration: 12–24 months
• Delta: 0.75–0.85
• Strike: Near intrinsic value
• Extrinsic value: <25–30% of option price
• Open Interest: >1,000 contracts
If LEAPS extrinsic is too high → do not trade.
MODEL ALLOCATION
| Bucket | Capital % |
|---|
| Tier 1 Workhorses | 46% |
| Tier 2 Accelerators | 35% |
| Index / ETF | 12% |
| Cash Buffer | 7% |
Reality Check (Critical)
PMCCs fail when:
• You over-allocate to Tier 2
• LEAPS are bought too close to ATM
• Short calls are sold too aggressively
• Volatility regime shifts are ignored
They work when:
• You think like a market maker, not a stock picker
• Capital efficiency is respected
• Rolls are planned, not reactive
Global PMCC rules applied to every pairing
• Long LEAPS: 12–24 months, 0.75–0.85 Δ, low extrinsic
• Short call: 25–45 DTE, 0.20–0.30 Δ
• Income goal: premium first, not upside capture
• Never sell the short call below LEAPS breakeven
Management Triggers (Non-Optional)
• Take profits: 50–70% of short call credit
• Roll up & out: If underlying breaches short strike
• Replace LEAPS: When <9 months to expiration
• Reduce size: If IV collapses across the book