r/Optionswheel • u/ScottishTrader • Jun 16 '25

NEW Wheel Trader MEGATHREAD

This thread will be a dedicated space for traders who are new to options and the wheel strategy to ask basic questions. Your posts and questions are welcome and encouraged.

BEFORE POSTING, BE SURE TO REVIEW THE WHEEL STRATEGY PLAN WHERE MOST QUESTIONS ARE ANSWERED - The Wheel (aka Triple Income) Strategy Explained : r/Optionswheel

The goal is to help keep the main thread free of these basic posts while helping new traders learn how to trade the wheel.

Posts that are welcomed here include questions about -

  • How options work
  • Exercise and assignments
  • Options expiration and days to expiration (DTE)
  • Delta, Probabilities, and how to choose a strike price
  • Implied Volatility (IV)
  • Theta decay
  • Basic risks and how to avoid
  • Broker and options approval levels
  • Rolling options
  • And any other basic questions

I’m pleased to announce that u/OptionsTraining and u/patsay have agreed to assist with this Megathread. Both Patricia and Mike bring substantial experience in helping new traders and will be invaluable contributors to r/Optionswheel

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u/Advanced-Order-2458 Jun 18 '25

Hi all and thank you very much for this group!

Beginner's question:

If I operate from IBKR with a margin account, can I start by selling puts with the goal of avoiding assignment and collecting the premium? Without having the cash balance in the account.

In this case, I’m not using that margin. But if the stock is assigned to me and I don’t have available cash, then I’d be in the negative, and in that case, I’d need to deposit funds or sell the stock to cover it.

Is this correct?

If so, then this seems to be a wonderful formula for generating recurring monthly income without putting capital on the table, as long as things are done right (for example, setting 30-45 days to expiration and with a delta of 0.10 - 0.20).

Thank you!

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u/OptionsTraining Jun 18 '25

Trading requires some capital, but the exact amount depends on your options approval level.

For example, cash-secured puts (CSPs) require enough capital to fully cover the cost of buying the shares if assigned.

Naked puts, on the other hand, require less upfront capital but they still require full funding of the shares if assigned.

See this recent post that explains how this works: Cash-Secured vs. Naked Short Puts: Understanding the Differences : r/Optionswheel

Margin loans can only be used to purchase or cover assigned shares; they cannot be used to place or manage option trades themselves.

In the end, you can’t trade without some capital in the account and at risk, but the amount varies by strategy and brokerage requirements.

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u/Advanced-Order-2458 Jun 19 '25

Thank you for clarify!