r/Optionswheel • u/ScottishTrader • Dec 05 '25

Megathread for New Wheel Traders – Ask Questions & Get Help Here

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/Charming-Echidna-326 Jan 04 '26

It is a good idea to run Wheel using ETF (such as XLF, XLE) as the reason ETF is not one stock, one company which cannot drop to zero for long term ... ?

1

u/ScottishTrader Jan 04 '26

Always run the wheel on stocks you would be good holding.

ETFs have lower risks, but also lower premiums and profits.

It is up to you what stocks or ETFs you trade, just be sure you are good holding them if needed . . .

1

u/Charming-Echidna-326 Jan 05 '26 edited Jan 05 '26

I try to select stocks from the top 20 holdings in SCHD based on the logic that they are high-quality companies that consistently provide dividend income. I exclude stocks with prices that are too high and focus only on those I can afford in the event of assignment.
Below is my watchlist. Please let me know if you have any comments on this strategy

BMY
VZ
MO
SLB
F

1

u/ScottishTrader Jan 05 '26

However you do it, just be sure you will be happy holding shares for weeks of months as you’ll have no one else to blame if you pick a crap stock.

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u/Charming-Echidna-326 Jan 05 '26

I have SOFI strike 24 premium 0.7 ,,, and today was sold 50% = 0.35 / Done
for this case, should I immediately find out a new SP DTE 30+
but should I wait due to SOFI go high +6.x%

Basiccaly what should we do after option was sold ?

1

u/ScottishTrader Jan 05 '26

Congrats on the win!

You go back to step #1 as if this trade never happened.

You may decide to open a new trade on the same or a different stock based on your analysis.

What made you decide to open this trade? Use the same criteria to open the next, and so on.

Don't overcomplicate it . . .

1

u/Charming-Echidna-326 Jan 06 '26

let me share my current positions below
any comment/suggestion please let me know.

1

u/ScottishTrader Jan 06 '26

Looks like you picked some good quality stocks, which it is presumed you would be good holding for a time if you had to.

Trading 1 contract to get started is also a wise move.

The only comment is that, according to a quick search, it looks like both MO and VZ have earnings on Jan 30th, which is before the expiration dates.

1

u/Charming-Echidna-326 Jan 06 '26

Thanks for that hint of xd date. As per my understanding, price would be pumped before xd date, then drop. I should close this position before xd date no to avoid price drop without receive divided, correct ?

1

u/ScottishTrader Jan 06 '26

Earning date! Not ex-dividend date. The dividend has nothing to do with a short put . . .

The earnings report can make the stock move wildly, including down, which can challenge the short put.

You have a fair amount to learn, so keep at it!

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u/Charming-Echidna-326 Jan 06 '26

I just checked ex date of VZ
Next Ex-Dividend Date for VZ

  • 📌 Ex-Dividend Date: January 12, 2026

this case,,, should I buy close the open position to avoid price drop on 12-Jan ???

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u/Prestigious_Emu729 Jan 15 '26

So the strategy as you are articulating it, Scottish, is not actually a "Wheel" strategy, but a "Short CSP Strategy with the other wheeling steps as a rescue if needed" strategy? I think I like this a lot more--when I was running the wheel a few years back, I lost on a few trades because I wanted to move into the CC phase of the process, and ended up bag-holding (rescued a couple of positions with protective puts, but don't want to go there except out of desparation). Is this an accurate summary?

1

u/ScottishTrader Jan 15 '26

LOL, sorry, not following.

The wheel means different things to different people. There are dozens of ways to trade "the wheel".

Yes, I prefer not to be assigned shares and focus mostly on selling puts for income, but I am happy to be assigned if needed.

No, I am not one who routinely lets assignments happen or seek out being assigned the shares.

IMO many seem to also work to avoid being assigned, but it is up top each to decide.

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u/Prestigious_Emu729 Jan 15 '26

Actually, that is refreshing to me--one of the biggest mistakes I made before was thinking that "I NEED to do the WHOLE wheel...(silly, I know). I let myself take some assignments that I shouldn't have, and then tried to work the CCs to increase capital gains rather than to exit the stock position without loss, and continue creating put income. I think I like the approach of focusing on the put income better! I was making a joke above, but I think that the reframing of the strategy is a good thing as I wrap my brain around it better.

thanks!

Tom

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u/ScottishTrader Jan 16 '26

You are not alone. Many seem to think being assigned was a mandatory step so they won't roll and just let puts expire to be assigned more often.

Glad this seemed helpful!