Extending DTE for Increased Capital Efficiency

The podcast episode discusses extending the Days to Expiration (DTE) for the SPY45DTE income strategy to enhance capital efficiency and boost returns. By increasing the DTE, the strategy aims to optimize performance by capturing profit more efficiently. The extension of DTE affects the decay behavior of out-of-the-money options, resulting in faster decay in the initial stages and slower decay later. This modification allows for capturing 60% profit within an average time in trade of 11 days, enabling quicker recycling of capital for new positions.