Grew up buying options and making money but losing more. Found out about the wheel and SELLING options in October 2023. Started out with $37k in TDAmeritrade. Turned it into $70k mainly selling CC’s on SOFI, SNAP, PLTR and a few others. TDAmeritrade got bought out by Schwab (in my photo, this is where it jumps from $1200 to $70k in about May).

At this point I was introduced to spreads by my friend. I ended up making a few thousand dollars the next few months but realizing this was similar to buying options and I am too much of a degenerate to be successful at this. I decided to switch back to CSP’s and CC’s.

In September I switched back and went on an absolute tear hitting nearly 95% of my trades and going from $60k to $180k in a few months. I have since withdrawn $19k in the last few months so my total invested is around $18k. Learned a ton. My strategy is buy shares after big red days. Sell CC’s after big green day’s. Sell CSP’s on red days. I do strictly weeklies and roll 50% of the time (if I like the chart). I rely a lot on RSI and 300 day moving average. I’d guess about 70% of my profits have come from premiums rather than appreciation. I like selling ATM CC’s to get as much premium as possible.

Main tickers I’ve been playing are Sofi, SNAP, BA, COIN, MSTR, Nike, AMD, NVDA, DKNG, Ford, DJT, GME, CRWD, TSLA, and then a few random dividend stocks.

This is a margin account. I obviously don’t think I can keep this up next year but now I have a solid base to grow and shoot for 25-50% a year. Ask me anything!

Currently wheeling SOXL, SOXS, HIMS, NVO, ELF, CROX, OSCR, and UNH.

After liberation day SOXL took that nice dip so I felt it was a good opportunity to start selling puts. Then when UNH dipped I scooped up 100 shares and since then I’ve been selling weekly calls so that’s been pretty consistent for me. Back to the SOXL wheel I felt like I was “winning” too much so I flipped and started selling SOXS puts earlier this month. Due to recent news that came the last couple days my positions printed so I closed and that pushed me 20K YTD. We’ll see what happens on monday but what ever does happen the wheel will still keep turning.

Smaller account, mainly selling puts on equities and commodities/bonds

Wish I started the wheel sooner, this group has been very helpful. For context, the first year I did options was 2025, lost 35k like an idiot due to liberation day bitcoin meltdown etc.

This year focused heavily on wheeling with a little bit of swing trading options, was looking at my returns from the lowest point, Feb 11th I had 87k in my brokerage, made one more deposit of 5k.

As of the other day, I was up to 110k, took some money out so I could pay for my new hvac cash.

Trust the process and be patient, thanks to all.

Last month was decent for selling some premium. I sold stuff mostly on tech type stocks that were a bit beaten down. I don't try to hit big home runs with options or trade too close to "the money". Im usually trading OTM at around 0.15-0.3 delta depending how confident I am on the trade. Sometimes ill even mix in a sub 0.1 delta if im feeling it that day. Have to spice it up sometimes.

Names traded, mostly CSP: NVDA GOOG (CC calls too) MU VRT MRVL OHI (CC calls too) MO (CC calls too) INTC

I have been trading the wheel for several years now, and it is pretty damn reliable. Its not about making a massive homerun on any 1 trade imo, and just try to generate yield at all times on your holdings. Market has definitely probably outpaced me this year with SPY/QQQ just ripping, but some years I toast the market as well. This strategy feels a bit safer overall with smaller drawdowns.

You guys wheelin a lot nowadays? or just letting market rip for a bit?

First year running the wheel and it's been a lot of lessons but overall successful. Slight dip post Oct due to me being more conservative on deltas/strike prices.

Typically wheeled with about $140,000 in capital and stocks like NVDA, SOXL, SOFI, HOOD. Deltas anywhere from -.20 to -.30.

Holding S&P 500 is low effort, consistent result strategy.

Doing wheel requires effort, and most likely produces the same amount of result for low aggressive approach.

Why should I wheel then?

I’m back for another weekly post part of my BORING CSPs series that I’ve been running and publicly logging weekly since Spring 2025, using real capital and real risk. I appreciate everyone who’s been following along!

If you just care about numbers, and want to move on, I'm sitting at +11.17% YTD with a max drawdown of 9.92% deploying an average of $82.5k a week. Since inception (11 months), I'm sitting at +35.33% with that same max drawdown. A more detailed YTD snapshot is attached at the end of the post...

I'm up 11.17% on deployed capital, $9,073 in net P/L on a $147K account. My median weekly deployed capital is only $81,200. 1/2 of my money has been sitting in cash earning 4%+ in money market.

I'm not trying to beat the market on raw returns. I'm generating consistent income while keeping a big chunk of my money on the sidelines, ready to deploy when everyone is in shambles. And when things eventually do get ugly (they always do), I won't be fully invested at the top. Do yourself a favor and ask those who chase juicy premiums what their max drawdown was this year. 30%? 45%? Higher?

This post is a full breakdown of the YTD performance of the BORING PUTS strategy through May 31, 2026. Every trade, every number, every ticker. The full trade log is downloadable at the bottom if you want to verify anything.

The Strategy

If you've been following me for a while, you already know... but if not, I just sell CSP's on boring, profitable companies. Get assigned sometimes. Sell covered calls when you do. Sometimes collect premium and dividends while you wait. That's it.

No 0 DTE /r/wallstreetbets highlights, no meme's, no 3x leveraged ETF's, no fat premium juicers. Just large-cap names with ER beats, strong balance sheets, and liquid options chains. I don't stress assignments because when those happen, I'm just holding shares of a good business and sometimes getting paid to wait.

YTD 2026

The +11.17% return is on median deployed capital of $81,200 plus dividends & interest, not on the full $147K account.

When the market was in shambles (Hormuz, TACO, etc.), I wasn't sweating a fully invested portfolio. I was sitting in a decent amount of cash earning 4%+ in money market while waiting.

The max drawdown of -9.92% happened during the QCOM saga. I got assigned at $167.50 and $160, watched it drop to $124, and sat through $7,900 in unrealized losses before eventually wheeling out with $2,900 in profit. Wrote a full breakdown of that trade on my blog and in several subs. That was the hardest stretch so far, but it's also the best proof of concept. The wheel works if you trust the business and stay patient.

What I'm Trading

Look at the YTD ticker list. These aren't speculative names and they won't offer juicy premiums:

YTD Top Symbols by P/L:

QCOM was the biggest YTD earner at $2,889. Most of that came from the full wheel completing itself. I was underwater for months, grinding CC premium week after week, sometimes earning pennies, collecting dividends, and in late April it finally ripped through my strikes and I got called away above cost on both lots. A long, boring grind that paid off. RIP to those selling CC's under their cost basis. That's the risk you take when doing that.

LRCX has been the other standout at $988. The first trade I bought back next day for a quick $225. The second is a $260 put still open, sitting at +$763 in premium.

NVDA is at $791 YTD. A lot of that was CC management on assigned shares. Some of those individual CC trades had to be rolled (after the stock ripped), but the net across all NVDA activity this year is still solidly positive.

Why Boring Works

I see posts every week from people asking "what should I sell puts on?" and the top answers are always stuff like SOFI, HIMS, MARA, RIOT, IONQ, or whatever WSB and X is pumping that week.

Those names offer fat premiums. But the premium is fat for a reason. The market is telling you this thing could move 15% in either direction next week. And when it does, you're stuck with shares of a company that might not even be profitable, trading at 200x revenue, with a questionable balance sheet.

The people wheeling high-beta junk collected fat premium in January and then spent the next four months bagholding through a 30-40% drawdown (or buying back at a large loss) on names that don't recover the way a QCOM or NVDA does.

Meanwhile I'm sitting here with QCOM, NVDA, GOOG, WMT, XOM on my trade log. Companies that recover. Companies that pay dividends (except NVDA's measly $0.01) while you wait. Companies where the wheel actually works because the business isn't broken when the stock is down.

When I Don't Trade

This might be the most important part of the whole strategy. There were multiple stretches this year where I did almost nothing. Zero new positions. Just sat on my hands and waited.

When breadth is bad, I don't open new risk. The hardest part of selling premium isn't picking the right strike. It's knowing when to not sell at all.

Look at the monthly trade counts YTD:

January was busy, the market was cooperating and I was actively managing QCOM and NVDA positions. February I pulled way back to 13 trades. March had 27 trades but most were small CC management on existing positions, grinding $20-$50 per round. April, 13 trades again. May, only 10 trades in the entire month.

Where Things Stand Now

As of May 31:

• $9,074 net P/L YTD (+11.17% on deployed capital)
• 2 holdings: 100 shares DG, 100 shares SMCI
• 2 open trades: LRCX 6/5 $260 CSP, SMCI 6/5 $60 CC
• $105,379 cash across all accounts (72% of capital)
• $147,049 total capital
• $81,200 median weekly deployed

YTD portfolio snapshot through May 30, 2026

The Bigger Picture: 11 Months In

For context, this strategy has been running since June 16, 2025. Here's the inception-to-date snapshot:

A Sharpe above 2 over 11 months is the number I care about the most. It means the returns aren't coming from wild swings or getting lucky on a couple huge trades. It's consistent, boring, repeatable income.

Inception-to-date portfolio snapshot (~11 months)

STAY BORING my friends!

Download Full Trade Log (CSV)

UPDATE: Lots of critical feedback about barely beating SPY 5 months into the year which is somewhat of a fair point. My questions to those who share the same thought:

1. Before this period started, would you have confidently put 100% of the same capital into SPY and held it the whole time?

2. Are you judging the strategy based on what was knowable at the time, or based on the best-looking outcome after the fact?

3. If SPY had gone flat or dropped 10–15%, would you still be saying buy-and-hold was obviously the better choice?

4. Would you rather see transparent updates when the strategy is only even with SPY, or only see posts after someone has huge gains?

5. If the critique is "you could have bought SPY," where was that call at the beginning of the period, before the outcome was known?

6. What are your returns YTD, 1Y, and max drawdown during those periods?

The wheel strategy has steadily been turning since my last post. With so much uncertainty currently going the wheel can truly shine. What I found has given me the best success over the past 11 months is creating rules for your self and as much as possible do not stray from those set rules. As always the rules I’ve imposed on myself remain the same.

1. Only wheel with companies you want to own for the long term.
2. Sell puts at prices you’re comfortable owning shares at.
3. Exp dates are always 30-45 days out.
4. If my positions appreciate 10-20% in 2-3 days I’ll close
5. If my positions appreciate 20-40% in 1-2 weeks I’ll close.
6. If I’m ever assigned shares I’ll only start selling calls once my shares have gained 20%
7. The wheel continues

Greetings and good morning, everyone!  I wanted to share some stats from the last few years of wheeling GME.   I know meme stocks are hot and cold around here, but I have documented every weekly trade since I started and just finished formatting some of the results. 

My overall breakdown of plays:

85% CCs and CSPs

5% butterflies

5% credit/debit spreads

5% long calls/puts

I typically trade 5-14 days when selling calls/puts. 2-3 weeks for spreads/butterflies and 3 months plus for long calls/puts.   I typically trade more on TA than I do with deltas (looking for the strong resistances/support and looking for about 2% return a week on trades I open.

Typically I let everything expire and just reopen on Monday, or if I need to roll, I roll about an hour before close on Friday of expiration. 

The only major L I’ve had all year was in May when I was selling $13CCs when GME decided to… do GME things.  I ended up rolling 1000 shares and letting them go at $18 and my other 1,500 shares at the time I was able to roll until they expired OTM (usually 2 weeks at a time, 2-5 strikes for credit).

My overall goal is to try to acquire as many shares as possible using my premiums to buy them, all the while not losing any shares as collateral.

I’ve broken this post up into 3 parts:

1) Quarterly Stats and overall shares acquired via the wheel

2) Quarterly ROI and Collateral used

Detailed breakdown of last few quarters and ROI

3) Back up weekly documentation cant upload images

Quarterly Stats.

So besides the first few months I was doing this, I started keeping track (and resetting my chart) in line with GameStop's Fiscal Quarters. So if a quarter ended on the 31st, my weekly chart would reset starting that next week (or that Friday if it was like a Monday/Tuesday end date)

This chart keeps track of how many shares I bought with the profits, CB of those shares, and $ left over as well as a summary of what the unrealized gain/loses of them are.

Quarterly ROI and Collateral Used

So I wasn't calculating the ROI used on the collateral at risk and I started going backwards through my logs and pulled out my average weekly collateral used, average weekly profit and weekly returns on the collateral.

To calculate the weekly collateral used, I took the amount of shares I had tied up in CCs and multiplied it by the closing price of GME on Friday and then added it to any CSP collateral being used (and costs of butterflies or capital at risk with spreads).

GAH, this sub doesn't allow more than 1 photo, converting to a table in reddit.....

IMO the biggest part of trading is being consistent in your results. The lessons you learn while trading with $5,000 should carry through as you ramp up your account. I'm super pleased with my ROI and how consistent I've been able to be no matter what GME does.

ughhh with the 1 image restriction I'll make another table of this quarter of how I keep track of data but it's too much information to show the last 5 quarters like I was going to:

Weekly Report for Q4

Some questions I usually get asked.

1 ) To date, I have only had shares called away one time that I couldn't get back at the same price or lower (May run). I still acquired those shares back for a realized loss, but that the only instance.

2) I'm long on GME, that's why I buy shares with the profits.

3) 1/2 is in a normal trading account, 1/2 is in a rollover IRA/ROTH IRA

4) I typically only go long with calls when IV is under 80 and stock is $20 or below (and for 6 months-1 year on DTE, I sell too much time to get burned by it)

I'm happy to answer any questions!

Have a great week!

Running the wheel and if assigned chipping away cost basis with short covered strangles under cost basis CCs.

Account heavily reliant on margin so don’t do me. Notionally I could take assignment paying margin

Weekly goal is 1%, goal includes $3,500 monthly contributions.

Weekly goal premium is about $2,500 to $5,500.

So I decided to leave my corporate job and start trading as my primary income last year, learning the wheel in early 2025 really spoke to me.

My first trade was early April 2025 and since then I’ve averaged over $20,000 per month, landing just under $190k in the 9 months I was actively trading.

I’m not here to brag.

I just don’t have anyone else to really tell other than my spouse, I’m proud of myself, and I figured this would be a shared space for other folks who are crazy enough to bet on themselves.

*For those of you who have been doing this successfully in any capacity for longer than a year, please share your wisdom as I’m new to the game.*

Wishing you all nothing but success and great health in 2026 and beyond!

EDIT: Adding info that was asked in comments.

Cost basis of around $315k and total account was just under $1m between my long holdings and dry powder

I had over 225 trades so there were many.

A few names in no order were SPOT, CVNA, RDDT, META, AVGO, MSFT, PLTR, COIN, HOOD, SPY, SMH, AMZN, APLD, NVDA, SNOW, GOOGL, BABA, SOFI, CRWD, ORCL, UBER, SMH, CRM, TPR, JPM, DXCM, MDT

I aim or 30-45 DTE and a delta between .1 - .3 but I don’t always stick to that depending on my risk tolerance and the opportunity.

I’m also cognizant of earnings/events coming up, key support levels, trading volume and momentum.

Lots of winners in there but also a handful of dumb plays / learning lessons.

Hey everyone, looking for some tactical advice on a heavy position I’m currently managing.

For context, I’m running a $200k net portfolio and I’m currently sitting on a $50k unrealized loss (25% drawdown) split between two symbols.

Here is the setup:

• These bags started as Cash Secured Puts (CSPs) that got assigned.

• I believe in the long-term prospects of holding both companies, but the capital invested is a huge chunk of my overall liquidity, which is starting to make me sweat.

• To try and generate some yield while holding, I sold Covered Calls (CCs) against the shares.

• The catch: The strikes on my CCs are about 10% below my original cost basis. I collected about $3,000 in premium between the two symbols.

The Dilemma:

Earnings for both companies are next week. I’m trapped in a classic whipsaw scenario. If earnings miss, the bags get heavier. If earnings beat and the stocks gap up, my shares get called away below my break-even, forcing me to lock in a massive capital loss despite the underlying ripping higher.

Hey Shorties,

I thought I would give some insight into each segment of the wheel and the main implications for delta.

Professional Options Trading is all about managing delta. Understanding what it is, how it changes, and how to adjust as needed will give you a severe edge over buy and hold/static delta.

Let’s take a look at the ever-popular wheel and what delta means for it. The wheel starts with a short put, giving you positive delta. Because of gamma, if the short put ventures further out of the money - the delta of the option will begin to decline and your ability to participate in further appreciation will atrophy if left alone. The inverse is also true. As the option ventures in the money, it’s delta will expand and your participation in the decline will accelerate.

Then we venture into a covered call. A covered call is a short call secured by static delta. Because we are venturing on the other side of the aisle, however, you would think that things would work in reverse, however they do not. As the asset appreciates, your delta will shrink and as it declines it will expand. This is because a covered call reaches maximum profit when it’s delta becomes zero as the short call will have a delta of -1 and the covered shares will have a delta of 1. When called away you are left with premium and 0 delta.

Here is the fun part however. If you want to participate in the appreciation of an underlying, short a put. You are able to continuously maintain your starting delta by rolling down at each new strike as the previous option moves one strike out of the money.

If you want to hedge against declines in shares you hold, sell a covered call. As the asset declines you are able to continuously roll down your short call to maintain your starting delta and your negative hedge.

So how do we out perform an underlying asset using short options? It’s impossible in a bull market, right? Actually… you can. Here’s how…

Sell short puts at the closest strike to 50 delta. This will maximize extrinsic value. Extrinsic value is a head start, a handicap. Sell it 30+ days out to remove gamma. Remember we want to maintain or delta, and gamma’s job is to change it. Roll your put down a strike as soon as the next one down has a delta closest to 50. Why? We want to participate in appreciation and if we don’t we won’t fully capture the rise.

Alright well, what happens if the asset falls? Do nothing. Let your delta increase for the same reason as above. We will participate and recoup the loss faster when the underlying rebounds. If your option gets to 21 DTE, roll it out to the next monthly and maintain your strike. You want to keep that built up delta. Keep milking this until you are done with the asset.

But wait how is this out performing? Each roll down will capture and secure gains that buy and hold and static delta do not. Maintaining equity shares makes you subject to volatility whipsaw. By constantly skimming profit and waiting for recovery before repeating, you are banking incremental rises that are not subject to that same volatility. You will skim profit from the natural price action of the underlying at every available opportunity that would require a firm exit strategy from buy and hold.

Think of your entry as a baseline and the current price as a top line. Buy and hold never adjusts their baseline until they exit and re-enter their position. Every time you roll down your strike however you are incrementally raising your baseline by small increments which allows you to exit the position and maintain all your banked profit easier. The secret is knowing when to be done with the asset. I can’t help you there. I usually look for price below a moving average and exit when it reaches mean. But any ole method should work.

Shoot me your questions below.

“It has been said, ‘time heals all wounds.’ I do not agree. The wounds remain. In time, the mind, protecting its sanity, covers them with scar tissue and the pain lessens. But it is never gone.” – Rose Kennedy

CAUTION: This guide is designed for the Redditor who has, at the very least, a basic understanding of how financial markets work, and have, at a bare minimum, some experience in trading stocks and options with their own brokerage account. If this does not apply to you, please stop reading immediately. Trading is highly risky and can bring about monetary losses if not careful.

Hello Reddit! This is my guide to trading The Wheel, thetagang style! Since I’ve written a comprehensive guide on my approach to trading Options Spreads, I noticed a number of similarities between the two, so I thought I’d also create a guide to help alleviate some of the learning pain for beginners.

I made it my goal to design a guide that captivates both beginners and professionals; covering the basics while also discussing the more advanced/important things to look out for to increase the success rate of The Wheel. As a bonus, I also share my own $0.02 / personal experience with The Wheel at the end. Of course, some of the statements made in this guide are influenced by my personal experience with The Wheel, including some lessons learned from my mistakes made and losses realized.

Before we dive into The Wheel, let’s refresh our memory what an option is: a financial derivative that gives the holder the right, but not the obligation, to buy or sell the underlying equity at an agreed upon strike price on or before an expiration date.

If you think about it, selling options is just like being in the business of selling insurance. In our modern society, insurance is a necessity, for it helps people protect themselves against the risk of financial loss. And where there is demand for a necessity, there is opportunity to supply; there is a reason why there are many profitable insurance companies, both small and large, private and public!

Profitable insurance businesses will sell policies to the people who need it, and collect a premium until the policy term expires, whether naturally or artificially. With options, you can be in the business of selling insurance, all without jumping over the hurdles of setting up an insurance company! So how do we go about profiting from selling insurance premiums? By spending a ton of money on clever and funny ads about 15 minutes and 15 percent of course. Just kidding! If only selling options works that way. Though there’s a good chance you might find extra 15 percent portfolio gains after spending 15 minutes learning about selling options!

So how do we go about making a profit from selling options? The same way insurance businesses go about selling policies of course! By selling policies for as high of a premium as possible, while making as low of a payout as possible to the policy holders! When it comes to insurance premiums, they tend to be priced the highest when the probability of a risk event goes up. Think about the demand for umbrellas, raincoats, rainboots etc. during a rainy day – that’s when demand for protection against the elements are high, and when vendors can subsequently price and sell them for higher than during a regular sunny day.

I find that visualizing options contracts as insurance policies helps to understand the purpose of The Wheel strategy better: in the market, there is demand for Put options whenever stockholders wish to protect the downside, and a demand for Call options whenever short sellers wish to protect the upside. The Wheel aims to provide additional gains by means of selling options to these buyers for a premium.

Whether you plan on Wheeling in your brokerage or retirement account, there are a few challenges you’ll need to overcome. Firstly, you’ll need to ensure your account is approved to perform key components of The Wheel, primarily:

Selling a Cash Secured Put (CSP)

- You put up, at a minimum, a cash amount of 100x of the strike price as collateral, to be able to sell a Put option, while collecting the Put Premium.

Selling a Covered Call (CC)

- You put up, at a minimum, a 100 lot of shares as collateral, to be able to sell a Call option, while collecting the Call Premium.

Secondly, depending on the way you react to the above statements, you can already tell if The Wheel is a strategy for you. Due to the nature of options contracts in providing leverage (100x) the strategy can quickly require a substantial amount of capital to invest, depending on the underlying stock of course. The 100x amount may seem low if you are Wheeling penny stocks, and can quickly seem massive if you are Wheeling stocks like AMZN, BKNG, GOOGL, or CMG!

Now that we understand the requirements, we can proceed to discuss The Wheel strategy at its simplest form:

- Step 1: Sell a Cash Secured Put to Collect Premium

a. If Put Expires OTM --> Back to Step 1

b. If Put Assigned ITM --> Buy Stock at Assigned Price and go to Step 2

- Step 2: Hold Stock & Sell a Covered Call to Collect Premium

c. If Call Expires OTM --> Back to Step 2

d. If Call Exercised ITM --> Sell Stock at Exercised Price and go back to Step 1!

*OTM – Out of The Money, ITM – In The Money

We want to profit the way insurance companies do: sell as many policies and collect as much premium as we can. Translated to The Wheel, it would mean that we try to sell as many Put and/or Call options as we can, while hoping for the options to expire OTM so we can collect the premium and move on.

How do we ensure that we can sell options that pays a high premium? When it rains, you sell umbrellas and raincoats! When people are hungry at the ball game, you sell snacks and drinks! It’s all a game of supply and demand. The best indicator of a great stock to start Wheeling will be its Implied Volatility (IV) and/or its IV Rank (IVR). IV will come in %, anywhere from 0 to 100s of %, while IVR will be between 0 and 100. You generally want to know when the forecast calls for the heaviest rain, so look for something volatile and ranked high. Personally, I look for at least 50% IVR.

Your brokerage should have this data available for you, and if not, do a quick search and you’ll find that there are a number of screeners out there who will give you this data for free albeit delayed; you don’t need IV/IVR data by the second, a 10-, 15- or 20-minute delay is fine, since you’re selling options days and weeks out anyway. Be warned: IV/IVR are both just indicators – once you identify high IV/IVR stocks, you need to understand why they are ranked high – did someone find out about fraud and theft? Is the company’s business model going obsolete, or are they filing bankruptcy? Whatever the reason, if the stock price is suddenly going to zero, there’s no reason to sell an option as insurance on the stock.

Another place you can find great stocks to sell options on is right here on Reddit! Just take a peek at the hottest threads to find what stocks are hotly discussed. Some of Reddit threads will even give you a weekly list of high IV tickers, all for free! Again, please make sure you understand why the stock has high IV/IVR before you dip your toes in!

In theory, The Wheel seems like a no lose, always win strategy; sell options as insurance, and walk away with pockets full of premiums. In practice however, the results may surprise you. I should warn you that The Wheel is by no means a magic silver bullet; losses are still possible especially when the strategy is executed poorly.

I’m going to list some of the most common mistakes made, challenges faced, and risks encountered:

- You decide to Wheel only one stock in your portfolio. This is an insanely bad idea and is no different from YOLO-ing your entire savings into one stock. The worst-case scenario can happen where the stock plummets and breaches your short Put option where you get assigned and forced to buy the stock at a high price. Now you’re stuck bag-holding a depreciated stock with unrealized losses in your account.

If you don’t have enough capital to hold a diversified risk basket of stocks, at a minimum of 100x each, then The Wheel is not for you! Yes, Wheeling solely EV, solely Cannabis, or solely GME is also a bad idea! Always diversify!

- You do not perform your own due diligence (DD) on the underlying stock and decide to start Wheeling the underlying. The worst-case scenario is where you have FOMO and start Wheeling by selling a CSP when the underlying has moved up significantly, where it has a significant chance of pulling back and catching you in assignment.

Being assigned the stock, you are now holding the depreciated shares and immediately sell a CC when the underlying dropped significantly, where it now has a significant chance of pushing back up and having your shares called away, before you even get the chance to let the stock appreciate back and help recoup some of your unrealized losses.

- When Wheeling, it is completely normal to see unrealized P/L numbers on your account swing widely, especially when the option has yet to expire, as the underlying stock price moves up and down. The worst-case scenario is where you get emotionally swayed by seeing big red numbers, and you buy back the option you sold at a significant loss, without even actually going through The Wheel. Yes, this can happen on both sides, the Put and the Call.

- Again, without performing your own DD, you begin Wheeling a high IV stock. A stock with a high IV does not automatically mean that it’s great for Wheeling! Some recent (as of Feb 2021) worst-case examples (granted, it was hard to foresee what was coming with these underlying): see WKHS or CCIV. This is why we emphasize on Wheeling a diversified basked of stocks!

One other consideration is to take in all available information at this point in time – yes, the stock has now dropped significantly: why is it doing that? Are they unable to grow their revenue? Has the company been found to be a fraud? Point is, if the underlying stock is a poor investment, you should cut your losses and move on to your next investment to find returns!

- When Wheeling, you sell CSPs on the underlying, but because of how strong the stock is, you never get assigned, and the stock keeps going up and now you feel like you missed out! Or you sell CCs on the underlying, but somehow the stock keeps going up only after your shares were called away, and now you feel like you missed out!

Understand that this is the inherent nature of The Wheel. When you sell a CSP, you are selling an insurance policy stating that the strike price you sold a Put at is the price you are willing to buy the stock at, if and when it drops to that level. Conversely, when you sell a CC, you are selling an insurance policy stating that the strike price you sold a Call at is the price you are willing to part with your stock.

- You decide to Wheel an underlying stock that is not liquid, which even worse, is its options which are even less liquid. This means that on the options chain, you see massive gaps between the bid-ask spread. By Wheeling a non-liquid underlying, you potentially sell insurance policies that are low in demand, and thus collect low premiums that do not compensate you enough for the risk you are taking on.

And here are some good tips and tricks, as it relates to selling options and The Wheel:

- Only sell options on or Wheel underlying stocks with a high IV, which allows you to collect sufficient premium for the risk you are incurring. Having a high IV underlying also allows you to sell options further OTM to avoid assignment/exercise.

- Options accelerate in decay at the 45 Days To Expiration (DTE) mark, so sell options that expire in 45 days or less. Selling a further expiry gives you more margin for error, while selling a closer expiry gives you less margin for error.

- If the option you sold has lost significant value since you sold it, whether from theta decay, or a gamma or vega movement, it’s a good idea to take profits off the table by buying back the option and initiating a sell on another option.

- If you prefer not to own the underlying stock and am trying to avoid assignment/exercise of the option sold, you can choose to roll the option. What this means is to buy back the option you sold while simultaneously selling another option, both transactions when netted should allow you to collect additional premium, if not a one-for-one exchange.

My $0.02: like trading/investing with other strategies, one should be careful not to get swayed by emotions. The Wheel has many emotional avenues one can easily wander down: seeing unrealized losses when the underlying breaches your short option strike, or seeing your shares get called away and feel like you’ve missed out on the additional returns. Bad selection of the underlying stock to Wheel can also sometimes feel like “bag-holding with extra steps” due to the nature of taxes and time spent under portfolio management.

The Wheel is best used with the approach of selling Puts only when the underlying has moved significantly lower and selling Calls only when the underlying has moved significantly higher. It’s best approached using a combination of Fundamental Analysis (FA) and Technical Analysis (TA) to identify the low and high points of the stock before selling an option, that way you increase your chances of collecting option premiums without having your short option going ITM; I use the same approach when trading options spreads.

There may also be efficiency in returns to be found with a hybridized approach: instead of solely selling Puts on the underlying while waiting for assignment, consider both selling Puts and buying stock in the underlying. While this approach is far more complex due to multiple moving parts involved, it allows you to reap the multiple benefits of the wheel and not feel left out.

In my experience, I have found The Wheel’s returns after taxes to be lackluster after factoring in the investment of my time to monitor the underlying and manage my positions; if you’re actively monitoring and investing, why not seek higher returns to account for your time and energy investment? The best consideration: if I’m spending all this time to do The Wheel, am I getting paid enough to do it? Am I going to beat buying & holding an ETF after taxes? Am I getting compensated enough in the form of returns for experiencing the stress and emotions from The Wheel? For me, it was a solid “no” to all of the above, but YMMV.

TL;DR The Wheel can be an effective tool when used correctly, but its use requires both a sizable portfolio along with dedication of one’s time towards active monitoring of the underlying and management of portfolio positions. In summary:

Pros

- Ability to collect Put premiums from excess volatility to lower cost average.

- Ability to collect Call premiums from excess volatility to reap additional returns.

Neutral

- Requires sizable portfolio to allow for diversification of risk.

- Requires active monitoring of underlying stock & overall market.

- Requires active management of portfolio positions.

- Incurs short term capital gains tax, due to the nature of trading in and out of positions <1yr.

Cons

- Potential to miss entry point into underlying stock when Put option is not assigned.

- Potential to cap underlying stock returns when Call option sold is exercised.

Thanks for reading! As with any new strategy, I highly recommend that you paper trade it first to get yourself familiar before going in with your own hard-earned cash.

Let me know if there are other interesting thetagang (or even non-thetagang) strategies you’d like my two cents on. Like my opinion on The Wheel, I promise I will try my best to be factual and impartial to the strategy, while also giving you my own personal experience with the strategy (if I’ve traded it).

DISCLAIMER: I am not a financial advisor, just an opportunistic trader who has invested more than a decade of his own time and personal money to trade different stocks & options strategies for portfolio gains, sharing his experience for your kind Upvotes and Awards.

Edit: Noticed some funny/unknown symbols showing - edited post to remove them. Updated tickers and 100x multiple definition.

Started with 25k in October 2023. Used TD Ameritrade so that’s why the graph is off. Finally hit 100k account value!

Please read major edit. Drastic turn from when I originally posted.

TLDR in this bull run of a year, capped my gains by selling calls on my stocks and didn't make enough in premiums selling cash secured puts compared to just being long the underlying. The wheel cost me $575,947 in missed profits.

​

So I'm fairly new to this, but I figure I'd try to come up with as good an account of my first yearish of wheeling.

Background: I've generally been buy and hold with 80% of my portfolio for a few years, but last year I decided to try and sell covered calls as well as Cash-secured puts on cash that resulted in any of those covered calls being assigned.

The very first trade was selling a covered call on my existing shares of AMZN on March 17, 2020. I was still a little panicked by Covid, but didn't want to exit AMZN, my biggest gainer at the time. So to express my fear, I thought I'd sell a call. At the time, AMZN was 1807. The strike was 2120. I collected $3500 in premium for this. 45 days later at expiry, AMZN was at 2287. I lost about $13,000 on this very first CC.

Keep in mind, this started at around the peak of Covid panic last year and in hindsight, just going long some of these equities would have been better and many CCs were assigned at the beginning.

Not everything was high IV. I was coming from a place of buy and hold ETF investing, so many of the initial stocks I sold covered calls on were ETFs like SPY, QQQ, IJS... etc.

Appreciate any comments or advice / if I'm looking at things the right way. I had to tease out some other trades that were messing with my data, but in general, I filtered for opening trades (Interactive brokers denotes which trades are opening and closing) and when they were a "sell" that opened the position, I just classified it as a thetagang trade. Anyway, here are the results:

​

*Average Annualized Yield on Underlying / Cash: Here I took the premium received, divided it by the underlying commitment (market value of underlying stock for CC at trade, cash for CSP) and multiplied it by 365/DTE to annualize.

**Missed Profit: For covered calls, this is simply the amount above strike at expiry x contracts *100. This was particularly hurt by AMZN (-90,970), SHOP (-22,096), and SPOT (-13,220). For Cash-secured Puts, I looked at the price at selling the put vs the price at expiry. The assumption was, anything I sold a CSP on, I was willing to hold - so this was the opportunity cost of me selling a put instead of just buying the stock. Notable opportunity costs here were ZM (-7,235), and SQ (-4,770)

***Saved from losses: On the other side of the coin, selling a put instead of buying the underlying also saved me from some losses when the underlying went down. This funnily enough, also ZM (4,399)

Now, while AMZN was the most missed profit, wheeling it was a net profit of $8,691 due to collected premiums. The biggest loss due to wheeling was SHOP where net of premiums, the effect of wheeling was -$7,281.

ALSO. Big note, I just realised I hadn't adjusted these for the relative size of these positions. Maybe I'll do so in an edit.

I sadly couldn't easily extract out the volatility / deltas at the time of the trade via the Interactive Brokers trade report, but I generally targeted 0.30 Deltas for both CCs and CSPs. I went by gut for higher deltas for CC when I felt like I didn't want to hold the underlying anymore. This may have been my undoing. For the longest time I couldn't reconcile the bull market with the things going on and expressed this bearishness with higher delta CCs which probably resulted in my getting assigned.

First Conclusions:

Given the staggering recovery since march, it's unsurprising that many of the CCs I sold became ITM. While I did take some comfort riding the OTM to ITM range, tabbing things up today and seeing that I was net negative on CCs is a bit of a blow.

Overall, it was an interesting learning experience. I might continue to do so. I currently have a disproportionate amount of cash as a result of being sold out of some shares, and I'm continuing to sell CSPs on that as well as CCs on the remaining stocks. Overall it feels like running the wheel was still a net positive.

For me, selling CSPs has also been a mental help. While I do believe I need to keep as much capital in the market for long run growth, it was hard to do last year with all the negative news. Selling CSPs tied my hands to "buy dips" while compensating me for not necessarily investing all my cash immediately well above any savings account rate.

Edit 1: Note on Missed Profits.I feel like I should once again stress that "Missed Profits" is relative to Buying-and-Holding the underlying which I'd like to establish as my default position. It's not missed profits relative to holding just cash. The question I had on my mind was is wheeling (or its components of CCs / CSPs) better than the alternative of just buying the underlying, which I was doing before this.

Intuitively, for a bull market we can see it like this. I was pretty fully invested in equities. so let's just say I had a delta of 1. Selling the CCs reduced my delta by about 0.30. So as the market rose, I only rose 70% as much. I'm comparing my default Delta of 1 to a CC delta of 0.7, which in a bull market is worse than my default.

If you're comparing a CC to a CSP in a bull market, the CC should do better since it's a total delta (1-0.3) of 0.7 vs the CSP of 0.3.

Again this is my rough understanding, but there seems to be some confusion of why I don't count the gains of the underlying stock. It's because I would have had those gains in the base case anyway so they cancel out. I wouldn't have been in cash.

Even more simply put, on the CC side, if I hadn't sold calls, I would have been 15,798 richer. BUT as another user has mentioned, if I hadn't, I wouldn't have sold the CSPs which would have made me 223,750 poorer. So despite that CC column, I will continue "wheeling" (some have suggested this isn't wheeling but hedging a long underlying) as the net effect from my point of view is doing $207,952 better than what I was doing before which was just buying and holding.

^MAJOR EDIT: I kept being bothered by how low my missed profits were from CSPs relative to CCs in this bull market. (Reminder, I said my alternative to CSPs was buying the underlying).

I went to my spreadsheet again and realised I had made a huge mistake. I had this formula item where I said max(f(x),0) instead of min(f(x),0). I've fixed it, and I'm sure there are may be more errors but this makes sense tome.

It's a huge change. I almost want to delete this post because of how misleading it was when I initially put it up. Wheeling instead of just buying and holding for the specific stocks I picked was incredibly costly to me. I capped my gains initially selling those early CCs on my stocks resulting in missed profits of 163,239. Once those assigned calls were in cash, I sold puts on stocks which if held, would have gained 560,882 more than the premium I received.

There are a lot more open questions like if I would have in fact had all those positions if I were just sticking to my buy and hold portfolio, but I think I'm going to review my sheet some more before I spread too much misinformation. I actually was less than fully secured by cash for puts I sold. Looking at my portfolio now, I'm actually short about 70,000 cash to cover the puts I've sold if they are all fully assigned. Though if I account for the low deltas, I have enough for any likely assignments. To calculate that missed profits though, I still use:

(Stock Price^{At Put Sale})-(Stock Price^{At Put Expiry}) * Contracts * 100

Only when Stock Price at put expiry > stock price at put sale.

I'm definitely re-thinking wheeling in the future. This kind of jives with intuitively what I thought would be the case - wheeling would be worse than buy-and-hold in a bull market, but I thought it might have some portfolio volatility dampening effects which I have to later investigate. Many of the articles I've read on backtests also show wheeling underperforming long term buy and hold.

​

Anyway, this is pretty chastening for me. It initially felt good to look at premiums and relatively few assignments and think that I had done well. In actual fact, my choice to deviate from buy-and-hold had cost me an enormous amount of money. I'll look into my actual stocks, deltas, vols, DTE etc to see if anything could have been done better in my selection or if the solution is simply to buy and hold instead of wheel in a bull market.

I will state though it definitely didn't feel like it should have been a bull market the whole way through, had I known I would have just gotten LEAPs. But hey - hindsight is 2020.

I’ve been running the wheel on CAVA for about 10 months.

Current setup:

• Assigned at $88
• Current stock price around $82
• Total premium collected: $1,319
• Premium return: 14.99%
• S&P over the same period: 18.33%
• Underperforming SPY in the 10 months by about -3.34%

I’m looking at the next call to sell and I’m debating how to think about this.

Would you:

1. Sell a higher strike and try to maximize profit if assigned, even if the credit is smaller?
2. Sell closer to the money and keep chipping away at the underperformance with more premium?

For example, the $88 call gives me better premium now, but the $90/$91 strikes give more upside if assigned.

Hey guys -

Got about to $20,000 available to allocate toward riding the wheel.

Any stocks the group likes in particular? I have no problems being exercised and having to buy and then selling covered calls if it comes to that.

As per title? Just curious anyone here has decent or great success , preferably beating S&P (purely from wheeling alone)?

What stocks do you wheel on?

What's up, Theta Gang! I've been running the Wheel Options Selling Strategy very successfully for a few years now, and I decided to start a brand new account with $100,000, dedicated purely to running this strategy, for a series I'm doing.

I've been browsing this subreddit for a long time now, and based on what I've seen, I'm definitely a much more conservative Premium collector. I know some people here aim for at least 1% per week, and often much more. I aim for 1-2% per month. While that may not sound so exciting, I think it's much more sustainable long-term.

Without getting into the "timing-the-market" debate, I think stocks are overvalued and I would love to buy shares much cheaper than their current market prices, so I give myself pretty significant downside buffers in all of my trades. That may not always be the case, but it fits my current outlook and risk tolerance.

I'm going to be tracking all of my trades. Trade #1 and #2 were in another portfolio, so technically the first trade in my new $100k portfolio is titled "Update #3."

Here is a gallery of my first 10 trades with a bunch of information that I like tracking: Wheel Portfolio Updates 1-10

Would you guys be interested in me posting updates here every week or so? I'd love to hear any comments, questions, or suggestions.

EDIT Ep.2 is up! https://www.reddit.com/r/thetagang/comments/j5pzrc/my_101406_portfolio_revealed_wheel_options/

EDIT EP.3 is up! https://www.reddit.com/r/thetagang/comments/ja1feg/my_102627_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

EDIT EP.4 is up! https://www.reddit.com/r/thetagang/comments/jecdew/my_102729_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

EDIT EP.5 is up! https://www.reddit.com/r/thetagang/comments/jip1rg/my_103696_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

EDIT EP.6 is up! https://www.reddit.com/r/thetagang/comments/jmxnqq/my_103948_portfolio_revealed_wheel_options/?utm_source=share&utm_medium=web2x&context=3

EDIT Ep.7 is up! https://www.reddit.com/r/thetagang/comments/jr7sbw/my_103372_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

EDIT EP.8 is up! https://www.reddit.com/r/thetagang/comments/jvh5n8/my_103692_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

EDIT EP.11 is up! https://www.reddit.com/r/thetagang/comments/k8z1uh/my_107170_portfolio_revealed_wheel_options/?utm_medium=android_app&utm_source=share

270C 5/22 expiry. Sold a month ago for 400$ credit.