Leg 7 — Progressive Roll Rule (QCOM)

The most efficient way to keep your float compounding: harvest fresh time value on a reliable cadence while preserving deep/medium ITM posture. This keeps realized sale price stair-stepping up and avoids adding shares or taking excess directional risk.

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Most Efficient Rule — Progressive 6-Month Roll (Leg 7)

Every ~6 months, as new long-dated expirations appear, roll your existing deep or medium ITM covered call forward and slightly down in strike. This captures fresh time value without adding shares, raising your realized sale price and compounding released float. Prefer smaller, frequent harvests over chasing one large premium.

QCOM — Progressive Extraction Example

MetricValue / Notes
Shares500
Cost Basis ($/share)$177.50
Initial Strike (Jan 2028)$150.00
Premium Received ($/share)$34.41
Effective Sale Proceeds$184.41 ≈ $183 (net realized)
Capital Released (Extracted)$17,205.00 (≈ 19 % of position)
Retained Capital (Locked)$71,545.00
Dividends (2.2 yrs)$3,856.67 → Yield ↑ to 2.49 %
Ending Value of Reinvested Cash$25,337.97 (+47 % on float)
Realized P&L at Assignment+$6.91 / share = +$3,455.00
CAGR – Realized Sale Only2.20 %
CAGR – Combined Outcome9.44 %
Six months later, as June 2028 options appear, roll Jan 2028 $150 → June 2028 $130 for ≈ +$8 premium. That $8 × 500 = $4,000 adds to your realized price ($183 → $191 → $201) while your freed float compounds elsewhere.

QCOM — Progressive Roll (Jan 2028 → Jun 2028)

MetricValue / Notes
Shares500
RollFrom $150 (Jan 2028) → To $130 (Jun 2028)
Total Premium Credit$27.00 / share
Allocation – Capital Gain$7.00 / share → raises realized sale price
Allocation – Freed Float$20.00 / share → $10,000 cash released on 500 sh
Effective Sale Proceeds (new)$183 → $190 / share after this roll
Strike After Roll$130 (keeps deep/medium ITM posture)
Locked Capital After Roll$130 × 500 = $65,000
Float UseDeploy $10,000 to T-Bills or next extraction leg to keep compounding
The $7/share boosts realized exit price while $20/share becomes new float. Repeat on a ~6-month cadence as later-dated options list to keep premiums flowing and the effective sale price stair-stepping.
  • Roll cadence: ~every 6 months when new long-dated expirations list.
  • Each roll extracts fresh time value and lowers strike to protect against overvaluation.
  • Use released float for T-Bills or next capital extraction leg.
  • Over time this method produces the highest CAGR per unit of risk and capital velocity in the framework.
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Disclaimer: Educational illustration only; not investment advice. Options involve risk. Dividends and corporate actions can change. Use valuation discipline and risk controls.