How the X-Ray Score Works — Scoring Methodology

The X-Ray Score is a quantitative put-selling research indicator on a 1-10 scale. This page documents the full scoring methodology — how multiple market dimensions are aggregated into a single number that reflects how a stock currently ranks for Cash-Secured Put research. It is not a recommendation to trade — it is a research filter to narrow down the curated watchlist to the strongest current candidates.

The score evaluates stocks for Cash-Secured Put strategies — selling put options backed by cash to collect premium income.

💡 Try it live: Open the Position Size & Yield Calculator on AAPL — drag sliders for account, strike, premium, and DTE to see exactly how the math works for any ticker.

The Four Core Dimensions

Regime — Whether the stock trades above (Bullish) or below (Bearish) its 200-day moving average. Put-selling performs significantly better in bullish regimes because trend acts as a tailwind. Stocks below their SMA200 receive a score penalty. Read more about SMA200.

SMA200 Distance — How far the current price sits from the 200-day average, expressed as a percentage. A stock 15% above its SMA200 is in a strong uptrend. A stock barely above it might be on the edge. Extreme distances in either direction reduce the score because they signal overextension.

Volatility — Current price volatility relative to the stock's own historical norm. High volatility means richer premiums but also higher assignment risk. Low volatility means thin premiums but more predictable behavior. The score rewards balanced volatility regimes. Learn more about how volatility drives options pricing.

Momentum — Direction and acceleration of recent price movement. Accelerating upward momentum earns a bonus; decelerating or turning momentum reduces the score. Momentum affects how quickly theta decay works in your favor.

Price Action Layer

Candlestick reversal patterns are detected on recent daily candles — Hammer, Morning Star, Bullish Engulfing, Doji at support, and others. Patterns found near SMA200 support receive additional weight because they often mark turning points. Bearish patterns (Black Cloud Cover, Hanging Man) reduce the score.

Final Assembly

All layers — plus additional proprietary adjustments — combine into a raw score which is then clipped to the 1.0-10.0 range and rounded to one decimal. The result:

• Score 8+ — Strong quantitative profile. Multiple dimensions align positively.
• Score 6-7 — Favorable conditions. Worth deeper research.
• Score 4-5 — Mixed signals. Additional due diligence required.
• Score 2-3 — Weak profile. Elevated risk for put-selling.
• Score 1 — Unfavorable across measured dimensions.

What the Score Does NOT Include

The X-Ray Score focuses on price-based technical dimensions. It does not include implied volatility rank, insider transactions, or fundamental valuation. Earnings risk windows are checked separately — see the earnings warning on individual ticker pages.

Daily Updates

Scores are recalculated every night after market close on the full curated watchlist of US-listed stocks. Past scores do not predict future outcomes. The methodology is fixed but the underlying data moves every session. Scores can shift significantly — a stock that scored 9 last week can drop to 4 today if its momentum turned.

How Closed Trades Are Priced

The X-Ray Score above is a forward-looking research filter. The track record on the homepage and the Research Lab are the backward-looking record — every closed trade ever published. The pricing rule used to book those exits deserves its own section.

Quotes, not midpoints. While a position is open, every 5 minutes during US market hours we capture the live bid and ask of the option contract. Those quotes are the raw material — not a broker midpoint at the moment of close, not a single end-of-day print, not a screenshot price published when a "closed" message was tweeted.

60/40 weighting. Every captured quote is weighted as (ask × 0.60) + (bid × 0.40). The result pulls toward the side a put-seller actually pays when buying back to close. For Bull Put Spreads the same pessimistic weighting is applied to both legs — short leg pulled toward ask, long leg pulled toward bid, net spread computed from the worse-of-both view.

Why deliberately make the track record look worse? Because the alternative — booking exits at the midpoint, or at the screenshot price published when a "closed" message was tweeted — is the standard backtest dishonesty. Midpoint exits assume a perfect fill that retail customers never get. They make published track records look noticeably better than what customers actually experience. The invariant here is the opposite: the track record should never look artificially better than what an EOD-disciplined customer would have lived through.

The mechanical effect. The 60/40 weighting determines when a take-profit or circuit-breaker fires — the price has to cross the threshold from the customer-pessimistic side. Take-profits become harder to trigger; circuit-breakers become easier to trigger. Both directions move the published record toward customer reality.

What this means in practice. The 60/40 model deliberately bakes in slippage and bid/ask friction at a level pessimistic enough that midpoint-quality fills — the kind retail traders typically get on liquid contracts — would actually beat the price the track record books at. The intent is to publish a number a disciplined customer can plausibly match at standard retail conditions, not one that requires institutional execution to reproduce. The published track record is engineered as the floor, not the ceiling. Execution quality varies with liquidity, spread, and order routing — illiquid contracts and stressed markets can still produce worse fills than the model assumes — so the framing is "realistic worst case," not a promise.

The full audit trail — every tracked setup, every close update, every recorded P&L — sits in the public Google Sheet.