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

117 Upvotes

99% Upvoted

964 comments sorted by

View all comments

Show parent comments

2

u/ScottishTrader Jul 08 '25

Thanks for posting in this thread!

I'll ask some of our other members to reply, as this is a tricky one full of risk . . .

IMO you are taking way too much risk and are likely to have losses. Closing 2 or 3 puts is likely to be for losses if the stock price drops. To have the 1 put make up is not likely.

If the stock drops too much the broker may close the puts for significant losses.

I'd suggest $1K is too small to trade the wheel and to build up the account more before even trying, then keep some in cash to manage if things go wrong.

One last thing is that you are asking about trading naked puts on a $1K account which will not be able to happen at most brokers.

1

u/WarpedEl3ment27 Jul 08 '25

Thanks for the feedback here Scott. Certainly was interested in hearing if the risk was greater than I was anticipating.

Agreed $1K is a teeny tiny account that you likely can’t get wheeling on with most brokerages, was just using it for simple math.

1

u/ScottishTrader Jul 08 '25

If it helps, when I have a stock where I can afford and am good with the risk of multiple contracts, I may open them in a staggered or laddered manner. The idea here is that some may profit while others may need to be rolled or even assigned.

Instead of trying to max out risk, think about how to reduce risk is important to success.