Max Bridge System Manual & Wiki
Comprehensive guide to the algorithmic mechanics, parameters, risk thresholds, and five-pillar balance sheet intelligence powering Max Bridge.
Table of Contents
1. Francine Screener v3 — Algorithmic Engine
The Francine Screener is a systematic stock discovery engine designed for options traders selling Cash-Secured Puts (CSPs) and executing the Wheel Strategy. It enforces strict mathematical firewalls to eliminate speculative companies and isolate liquid, high-quality businesses trading at viable option premiums.
Market Universe Tiers
The universe is stratified into four distinct tiers:
| Tier | Universe Size | Characteristics & Role |
|---|---|---|
| Tier 1 — S&P 500 | ~503 stocks | Blue-chip large caps ($15B+). Maximum institutional sponsorship, ultra-tight option spreads, predictable balance sheets. Ideal for core capital. |
| Tier 2 — S&P 400 | ~400 stocks | Mid-cap leaders ($3B–$15B). Higher growth trajectories with healthy option volumes; excellent yield opportunities on dips. |
| Tier 3 — S&P 600 | ~600 stocks | Small-cap profitable businesses ($1B–$3B). Higher implied volatility (IV); requires strict financial scrutiny. |
| Tier 4 — Rest of Market | ~5,500 stocks | Broader Nasdaq/NYSE universe excluding the top indices. Filtered aggressively through Nasdaq Trader volume scans. |
What Every Screener Lever Does
Price Range ($ Min / $ Max)
Purpose: Controls cash outlay for 100-share assignments.
Selling a put on a $30 stock requires $3,000 in collateral. Setting bounds between $10 and $50 ensures full account diversification without over-concentrating your collateral pool in single mega-cap names ($200+).
Target Implied Volatility (IV %)
Purpose: Isolates the option premium sweet spot (Target ± 10%).
• IV < 25%: Premium collected is too small relative to capital committed.
• IV 30%–45%: Ideal annualized returns (15%–30%) with manageable tail risk.
• IV > 60%: High binary risk (earnings surprises, impending bankruptcy, biotech trials).
Minimum Daily Volume
Purpose: Guarantees institutional participation.
Filters out thinly traded equities where market makers widen option bid-ask spreads. Default is 2,000,000 shares/day to ensure tight bid-ask spreads (<$0.10–$0.20) for easy entries and exits.
Options Chain Verification
Purpose: Validates active trading on the chain.
The engine automatically audits the options chain to confirm at least 2 active expiration dates and positive open interest. If options are illiquid or weekly chains do not trade, the stock is automatically disqualified.
Automated Disqualification Firewalls
Every ticker is automatically audited against non-negotiable rules:
- Geographic Exclusion: Excludes emerging market jurisdictions with opaque regulatory frameworks (China, Russia, Brazil, Argentina, Venezuela). Permits only US, Canada, UK, Western Europe, Australia, Japan, and Israel.
- Sector Exclusion: Excludes opaque financial balance sheets (commercial banking, insurance holding companies) that carry systemic leverage risk.
- Price Buffer Check: Evaluates discount relative to 52-week highs to avoid buying at overextended peaks.
2. MAX Company Strength — Five-Pillar Intelligence
Before selling a put or purchasing 100 shares, the MAX Company Strength engine performs an institutional audit across 5 core pillars of business quality using audited SEC 10-K and 10-Q financial statements.
Deep Pillar Breakdown
Pillar 1: Economic Moat (Rating 1–5)
Competitive DefenseEvaluates the company's structural barrier to competition:
- Gross Margin Dominance: Gross margins > 50% signal pricing power and brand strength that competitors cannot easily undercut.
- Network Effects & Switching Costs: Proprietary software ecosystems, entrenched developer communities, and high integration friction.
- Cost Advantages & Scale: Unmatched distribution scale and supply chain leverage.
Pillar 2: Management Quality (Rating 1–5)
Capital StewardshipAudits how effectively executive management allocates shareholder capital:
- Return on Invested Capital (ROIC) & ROE: Return on Equity > 15% demonstrates superior capital efficiency.
- 5-Year Revenue & Profit CAGR: Consistent top-line and operating profit expansion across 5 consecutive fiscal years.
- Prudent Capital Allocation: Funding reinvestment organically through operating cash flow rather than dilutive equity offerings or reckless leverage.
Pillar 3: Financial Strength (Rating 1–5)
Solvency & Balance SheetMeasures balance sheet fortitude to withstand economic recessions:
- Debt-to-Equity (D/E < 0.50): Low long-term debt relative to equity ensures no solvency vulnerability during macro shocks.
- Current Ratio (> 1.50x): Strong current assets vs current liabilities guarantees no short-term liquidity crunches.
- Cash vs Debt Coverage: Cash and short-term liquid equivalents exceeding total long-term debt.
- Altman Z-Score (> 3.0): Safe zone predicting bankruptcy risk near zero over a 24-month horizon.
Pillar 4: Earnings & Cash Flow (Rating 1–5)
Real Cash GenerationReconciles reported accounting profits against real cash deposited in the bank:
- Operating Cash Flow (OCF): Positive, growing cash flow from core operations.
- CapEx Reinvestment Rate: CapEx consuming < 30% of OCF indicates capital-light, high-leverage operations.
- Free Cash Flow Conversion: High ratio of net income converted directly into free cash flow.
Pillar 5: Business Durability (Rating 1–5)
Long-Term SurvivalEvaluates survivability and structural revenue diversity:
- Segment Diversity: Checks whether a single customer or division accounts for > 50% of operating profits.
- Disruption & Regulatory Risk: Exposure to technological obsolescence, antitrust legislation, or geopolitical tariffs.
Free Cash Flow (FCF) Reconciliation Rule
Operating Cash Flow minus Capital Expenditures (SEC XBRL statement of cash flows). We never blend non-GAAP adjustments.Grade Mapping & Confidence
| Grade | Composite Score | Trading Action |
|---|---|---|
| A | 4.5 – 5.0 / 5.0 | Elite Quality: Prime candidate for core Cash-Secured Puts (CSPs) and wheel assignment. |
| B | 3.5 – 4.4 / 5.0 | Solid Quality: Viable candidate with minor concerns (moderate debt or cyclical margins). |
| C | 2.5 – 3.4 / 5.0 | Speculative / High Risk: Commits capital only on tight tactical setups or reduced size. |
| D | < 2.5 / 5.0 | Disqualified: High leverage, negative FCF, or declining moat. Permanent firewall pass. |
3. Trading Strategy & Platform Architecture
The Francine Wheel Strategy
Max Bridge combines the Screener and Company Strength engines into a cohesive options cycle:
- Screening: Identify stocks meeting strict price, IV %, and options volume thresholds.
- Strength Verification: Confirm the stock earns a Grade A or B on all 5 pillars with High/Medium research confidence.
- Sell Cash-Secured Put (CSP): Sell 30–45 DTE puts at strikes at or below verified support. Collect upfront premium.
- Outcome A (Expires OTM): Keep 100% of the premium. Repeat on next candidate.
- Outcome B (Assigned): Buy 100 shares at a discount strike of a business you already proved is fortress-quality. Immediately sell covered calls (Wheel Strategy) and collect dividend yields.
Two-Factor Authentication & Resend API
Max Bridge implements zero-trust authentication:
- Argon2id & bcrypt Hashing: Passwords are salted per user with work cost 12 — never stored in plaintext.
- Transactional Email via Resend: Instant 6-digit cryptographic codes sent directly to your registered email on login when 2FA is enabled in your Profile.
- Single-Use Password Reset Tokens: 32-byte cryptographic tokens with 60-minute expiry that instantly revoke prior tokens upon consumption.
Persistent Background Execution
All Screener runs and Company Strength investigations run in a global application context. You can start an S&P 500 screen, switch tabs to read Company Strength reports or update your Profile, and return at any time. When finished, the header navigation link turns bright glowing green with a completion checkmark.
Max Bridge · Francine Screener v3 + MAX Company Strength · Educational options & balance sheet intelligence.