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Before 2010, I had a problem. I’d been running this strategy with other people’s money in a fund — selling credit spreads to capture time decay — but I could only execute it once a month.
Why? Because it’s the last week of expiration when time value decays the most. That’s when theta really kicks in, and with only monthly options available, I could only take advantage of that third week of the month.
Then weeklies launched in 2010, and everything changed. Suddenly I could capture that accelerated decay every single week instead of waiting around for the final stretch of monthlies, and that’s when this strategy became a core part of my approach.
The 25% Daily Erosion Window
Here’s the mathematical reality driving this entire setup: even if the stock doesn’t move, option prices can drop around 25% per day — or more — during that Tuesday through Friday window.
Even if the stock stays flat, those option prices decay rapidly into expiration. That’s pure time value evaporating, and when you’re short those options, that erosion works directly in your favor as income.
That’s why I specifically target Tuesday through Friday trades. I’m not holding for weeks and I’m not relying on directional calls — I’m focusing on the narrow window where time decay is working hardest.
The best part is it doesn’t even have to go up or down. It can go sideways, and the trade can still work.
Set It and Watch It Happen
One of the things I like most about this approach is how visual and repeatable it is.
You can actually watch the time value drain out of the premium as the days pass, and even see acceleration intraday around midday when decay tends to pick up.
This isn’t theory — it’s observable and mechanical. You’re not relying on luck, you’re aligning with a consistent force in the market that behaves the same way day after day. It’s similar to my Market Masters co-host, Jeffry Turnmire’s “beer money” trades, just stretched over three days instead of a much shorter window.
I check the trade maybe 10 to 15 minutes before Friday expiration, and that’s about it. The rest of the time, theta is working whether I’m watching or not, which is why I stay disciplined about the Tuesday-to-Friday window.
It’s not about being clever or predicting direction — it’s about letting the clock do the work and consistently capturing the income it produces.
Trade well,
Carter
Jack Carter Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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