Finished study — PMCC-001

Short calls improved 92 of 96 runs.
Without one assumption, 59.

The assumption is that the options you sell are worth less than you are paid for them. Every covered-call pitch you have ever read takes it for granted, and none of them show you what happens when it is not true. This is the instrument that showed us.

The finding

Do short calls really improve a LEAPS strategy?

92 of 96

Baseline historical-model configurations in which short calls increased terminal wealth, with the options assumed to sell for 15% above fair value. Median improvement $11,266.

59 of 96

The same configurations with that 15% set to zero. Same strategy, same paths, one assumption withdrawn. Median contribution falls to $1,362.

An edge that survives in 92 of 96 runs looks settled. An edge that needs the options to be 15% overpriced to get there is a different claim, and it is the one you are actually making every time you sell a call. Nobody can tell you what that number is for your stock on the day you sell it — so the free lab hands you the dial and lets you watch the answer move.

These are overlapping model runs, not independent trials or real option-chain backtests. The study states its protocol, its seed and its assumptions, and the comparison is rerunnable in your browser.

Across the research completed so far, results have more often been unfavourable to option sellers than favourable. That is the finding, not a disclaimer. If you are looking for a tool that agrees with you, this is the wrong one.

Your backtest ran once.

History delivered exactly one path. Whatever your covered-call or Wheel backtest returned is a single draw from a distribution you never got to see — and you have no way to tell, from that one number, whether the edge was real or the path was kind.

What a backtest tells you

One realization of the past.

  • What happened, once, on the single path that history actually took
  • Results built on the one implied-volatility environment that occurred
  • One sequence of drawdowns, in the order they happened to arrive
  • An edge that may belong to the path rather than to the strategy

What the simulator adds

The distribution that result came from.

  • Thousands of alternate markets, block-resampled from real SPY and QQQ daily returns since 2001
  • Option richness as a dial you sweep, not a fact you inherit — the one variable history ran only once
  • A dynamic IV surface with skew and term structure, plus real decay, rolling, and assignment mechanics
  • Falsification and holdout workflows against exposure-matched benchmarks, so a result has to survive being attacked

This does not replace your backtester. A backtest estimates what the market did; this estimates how much of that was luck. Run both.

While you are subscribed

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Plans

Start free with no account at all. Subscribe when you want to attack a result rather than read one.

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  • Run the covered-call comparison in your browser
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  • Fixed settings, one benchmark, no saved history

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  • Premium-sensitivity, threshold-robustness, regime-sweep, holdout and falsification workflows — the tools that break a result
  • Reproducible server-run results, saved to your own account history
  • Cancel any time from your account

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Before you subscribe

Portfolio Research Lab is a research and education instrument. It simulates markets. It has no brokerage connection, places no trades, and handles no real money.

Nothing produced by this tool is investment advice, a recommendation, or a solicitation to trade. Mark is not a registered investment adviser or broker-dealer. Options carry substantial risk of loss and are not suitable for every investor.

Simulated results are not predictions. They describe the behaviour of a model under stated assumptions, and every published finding on this site carries its assumptions with it. Read them. Across the research completed so far, results have more often been unfavourable to option sellers than favourable — that is the finding, not a disclaimer.

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