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QDTE pays 36%, SPYI pays 12% - both well above 7.7% & 5.5% If your interest is well above 10%, then I'd say go ahead and pay them off now. Me personally, I'd let a combo of high income funds pay it off for me (QDTE, MAGY, GPTY, QQQI, SPYI).
I find it much more useful to look at real quotes rather than use theoretical values because assumption math or textbook math doesn’t match reality of the markets especially on options. Did you try to pull up an actual order ticket during market hours to get a real price for the contract you wish to sell? Depending on the instrument and DTE you may find that a delta 1.00 or 0.99 strike (since you mentioned wanting near zero extrinsic value) which should be “deep in the money” is actually only a few dollars under current stock price and the bid ask spread may show you a bid that is negative intrinsic value on the seller side of the price? For example using one of the YieldMax ETFs trading near $50 Friday (GPTY) shows spot at $49 and going out 230 DTE the lowest strike available on the chain (market is closed as I type this) is $43 at 0.97 delta and while the ask/buy side shows $7.90 premium the bid/sell side shows $4. Zero open interest and likely no reason for MM to meet you in the middle. So if you bought GPTY at $50 and let’s say have already experienced $1 of nav erosion to the current price of $49 you collect a $4 premium on $50 of your invested capital. And you tie up that capital until expiration or would have to buy it back at a much higher cost due to the spread and ever increasing intrinsic value. So the 1 delta $20 intrinsic value at $35 strike on $50 spot may only exist in theory and don’t forget the bid-ask spread puts that $20 on the buyers side of the contract not yours. I’m sure there are other examples out there with better options than $4 income on $50 capital but I just grabbed an ETF near $50 and 6 mos based on your given scenario. That’s why I look at chains during market hours and I find even then for these low / no volume situations the order quote and ability to fill will even vary further. In this particular instrument pulling the DTE closer (to 20 DTE) had almost no impact so shorter contract would yield same income and thus be the better deal. The 50 DTE had lower strikes available but at a bigger negative intrinsic value for the seller.