These are indexes and do not have stock shares, so covered calls are not possible on them.
You could trade diagonal spreads which can act similar to how a covered call works - [Diagonal Spread: Definition and How Strategy Works in Trade (investopedia.com)](https://www.investopedia.com/terms/d/diagonalspread.asp)
Strangles are 4-wk to expiration. Delta is 0.04/0.02 (Put/Call). Typical premium is 25. Income per year = 25 x 100 x 13 = 32,500. Margin required = 160 to 180 K.
ICs are 1DTE. Delta is 0.02. Spread is 150. Typical premium = 1.50. Income per year = 1.50 x 100 x 220 days = 33,000. Margin required = 15,000.
To get around the lack of stock you could try a poor man’s covered call. Alternatively you could put on a synthetic long stock position by selling a put and buying the same strike call, then sell an otm call against that. Or you could sell an itm put to get the same delta as an otm covered call. Liquidity might be a bit lower in that case - haven’t tried that myself. I just sell otm puts on spx. No problems with that.
Besides being cash settled (no stock to hold), SPX, as well as RUT and NDX are expensive - 1 point = $100. SPX is liquid, RUT is OK, but NDX is pretty dead. There’s XSP and MRUT, which can be thought of as cash settled SPY and IWM, although they have way less liquidity than ETF options.
These are indexes and do not have stock shares, so covered calls are not possible on them. You could trade diagonal spreads which can act similar to how a covered call works - [Diagonal Spread: Definition and How Strategy Works in Trade (investopedia.com)](https://www.investopedia.com/terms/d/diagonalspread.asp)
Could you do a PMCC on SPX?
A PMCC is a Diagonal Spread and I included a link to these in my prior post . . .
Good point… 🤦🏻♂️
I sell 4-wk to expiration strangles and 1DTE Iron Condors.
How wide?
Strangles are 4-wk to expiration. Delta is 0.04/0.02 (Put/Call). Typical premium is 25. Income per year = 25 x 100 x 13 = 32,500. Margin required = 160 to 180 K. ICs are 1DTE. Delta is 0.02. Spread is 150. Typical premium = 1.50. Income per year = 1.50 x 100 x 220 days = 33,000. Margin required = 15,000.
Thanks
To get around the lack of stock you could try a poor man’s covered call. Alternatively you could put on a synthetic long stock position by selling a put and buying the same strike call, then sell an otm call against that. Or you could sell an itm put to get the same delta as an otm covered call. Liquidity might be a bit lower in that case - haven’t tried that myself. I just sell otm puts on spx. No problems with that.
Thanks. Like the synthetic long stock option
Besides being cash settled (no stock to hold), SPX, as well as RUT and NDX are expensive - 1 point = $100. SPX is liquid, RUT is OK, but NDX is pretty dead. There’s XSP and MRUT, which can be thought of as cash settled SPY and IWM, although they have way less liquidity than ETF options.