Wheel 101 · Part 4
A real wheel strategy example, and my rules
A real trip around the wheel (from my account)
- August 2026: Sold a META put at $580. META dropped, so I got assigned and bought 100 shares.
- September 2026: Sold a META covered call at $595. META went up, and my shares got sold.
I got paid premium on both steps, plus $1,499 on the shares, plus a small dividend while I held them.
And a real one that's not done yet
I got assigned MCD at $285. When I wrote this in October 2026, it was trading around $248. I'm down on the shares and selling calls while I wait. That's the wheel's real risk, and why the rules below matter.
The rules I follow
- Only stocks I'd happily own for years. If you wouldn't buy it anyway, don't sell a put on it.
- One contract per stock, spread across many. One bad stock shouldn't sink you.
- Take profit at 50%. If I collect $100, I set an order to close it when it's worth $50. Locks in a win, frees up cash.
- Never sell a call below what I paid. Otherwise I could lock in a loss.
- Keep cash for the puts. No borrowing to cover them.
These are my own trades in my own account. They aren't typical results and aren't a recommendation.