The "Wheel" Options Strategy - A Step By Step Walkthrough Of This Powerful Proven Trading Strategies
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- Опубліковано 6 лют 2025
- The Wheel Options Strategy - Proven Trading Strategies
This strategy is like “getting paid while you wait to buy a stock”. This is also one of the strategies known to be used by Warren Buffett.
This strategy is used on a stock that you're bullish on. It is used to profit on the downward movement of a stock, as the stock approaches your entry point.
For instance, let’s say that you’re wanting to buy shares of a particular stock.
However, this stock is currently trading much higher than your entry point.
Typically you would wait until the stock price moves lower before loading up on shares.
For this example, we’re going to use the stock ticker SQ. In this scenario, SQ is currently trading at $121.5 and you want to purchase the stock when it hits $100.
You’re bullish on this stock and you expect the price to go up, but you’re looking for the right entry point.
Because you want to buy this stock at $100, you sell a put option contract at the $100 strike price and receive a credit of $3.50, or $350. In this example, we execute the trade and the margin required for this position is only $1,000. Without a margin, the cost would be $10,000.
If the put option contract expires and the strike price is still above $100, you get to keep the $350. This would be a return of 3.5% in 35 days, which is the length of the contract expiration.
The stock is STILL above your entry point, but now you've earned 3.5%
Let’s say you repeat the process again, and you sell another put option contract at the $100 strike price. BUT the strike falls below $100 at expiration. If the strike price fell to $90 at expiration. You would be assigned 100 shares of SQ stock at $100 each.
Since the strike price is currently at $90, and you purchased the shares at $100, there is an unrealized loss of $1,000.
However, In this same transaction, you also made $350 in premium. Because you're longterm bullish on these shares, you do not sell them at $90 so there would be no loss realized. If you chose to sell them at $90, there would be a loss of $650. ($1,000-$350=$650)
Since you're the proud owner of SQ shares that you've purchased for $100, you can now sell call options against them!
Let’s say that you sell a $110 call option for 35 days out, with an expiration date of SEP 18. The premium received for selling this call option contract is $500.
As the expiration date approaches, the strike price moves down to $80. This would be an unrealized loss of $2,000 in the values of the shares, but you still earned a $500 premium. Because you're long-term bullish on these shares, you do not sell them. There is no realized loss, and you earned $500 in premium.
Up to this point, you were able to earn more than an 8.5% return, AND you purchased you still own the stock. If the stock trades sideways, and you still a call option contract, you STILL win with this strategy. The stock didn't increase in value, but you earned premium by selling call options.
If you sold a $110 call option, and the strike price moved up to $120, you earn $1,000 from the shares and the premium from the option contract.
Then you start the cycle all over again, because "the wagon wheel keeps turning"
Key Points:
1.) A powerful strategy that can deliver 30% per year, rather "safely". In this example, we earned 8.5% in 70 days which is more than 43% per year.
2.) It's important you choose a stock that is trending positive.
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Finally a teacher that anticipates the audiences questions and explains everything clearly using visual, audio and mental stimulation. I'm learning faster from Markus than any other teacher. Thank you!
Just wanted to say I have shared this video with well over 100 people. Learning the wheel strat changed my life. This is by far the best quick video to get peoples feet wet. Most FA I know act like what they do is magic and no one could understand it. Anyone can do this but many nope out the second you tell them it's a slow boring grind and requires math. However, for those of us who are not greedy, don't mind the grind. It compounds fast and is life changing. Thank you so much Markus, you have helped me changes the lives of many friends as your presentation is put in common terms so they can understand what i'm talking about and gives more validity than just me saying "trust me bro" .
Thank you so much for sharing this-your words mean the world to us! It’s incredible to hear how the Wheel Strategy has impacted your life and that you’re helping others experience the same transformation. You’re absolutely right: consistency, patience, and understanding the process can truly make a huge difference over time.
We’re thrilled the video resonated with you and your friends-it’s always our goal to break things down in a way that’s simple, clear, and actionable. Keep up the amazing work, and know that you’re making a real difference by spreading this knowledge. Thank YOU for helping to change lives! Let us know if there’s anything else we can do to support you or your friends on this journey. 🚀
I've been doing this on my own for over a year without realizing I was "wheeling". Now that I'm retired I've replaced my previous income through this strategy. It is VERY IMPORTANT to choose good stocks.
You basically reinvented the wheel 😄
20 * 100 = 2,000
Also he sold a $3.2 put option and earned $350. Pulled $30 from thin air.
😂😂
He should have edited
@@JamesLee-zr1er He changed it to 3.50 to make the math easy on 35 days.
I caught this . I was was wondering if I was wrong somehow lol
This is the most comprehensive, entertaining, and simplest way to understand options. I have my series 7 and struggled to understand options for the longest time.
Thank you!
Awesome! Thank you for watching, David! ;)
Good video. I have been trading the wheel strategy for a while now. It is a money faucet. Stocks and options together make the best business model. No tenants or employees to worry about.
That is awesome! .
yooo how r u doing man u still wheeling life? I wanna get there ugh
Down side of just trading his no tax benefits that real estate investing can give you. It would be beneficial to do both. If you don't want to deal with tenants then hire a property manager.
@@couloir1 You can just trade in a Roth IRA tax free. Just have to be careful with the Wash Sale rule.
Good review. I have been using this strategy on an “investment” which I should have cut. It works. Also, my six year old really enjoyed this video, he watched the whole thing with me and commented on the profit amount and was asking me questions about options. I was pleased and surprised by his interest.
Hi Roman, that's awesome that your six-year old is already interested in trading. My kids started trading on a simulator when they were 10 years old. Can't start them early enough! 😀👍
The most beautiful improper english ive ever listened too. Thanks for the help brother.
Lol. I hope this helps.
I am so grateful for all the videos related to trading. I used to pay $3000 in rent for 1 bedroom apt here in nyc. I showed the trading videos to my landlord and he has now lost all his money, had to sell his building and his wife gave him a divorce. But I am saving $1500 every month in rent as he is my room mate now. I am really happy and grateful for saving $1500 every month.
Funny
You have to study hard and stary small. Your former landlord is a dunce.
😂
😂😂😂😂😂😂
Lmao
Best video on options strategies and I have been searching UA-cam for a while to get a proper explanation. Really appreciate it!!
Glad it was helpful!
Finally! someone I can understand! Observational learning is the way I absorb (and hopefully retain) knowledge quickly. You're a godsend to all the new and aspiring investors out there. Keep it up!
Hi Jay, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
I've been doing this without knowing it has a name! Once I learned about calls and puts, I decided this is how I wanted to use the options.
Awesome! Thank you for watching! :)
I've watched a few of these instructional videos on puts and calls this is the only one that explains it so I actually understand how it works sounds like a great strategy with little risk
Awesome! :) Thank you for watching.
Your style of teaching is exactly the way I like to be taught! Excellent work Markus, keep it up!
Thank you! :)
Very interesting!
@@rockwelltradingservices what happened with your $RIDE trade 🤣🤣🤣🤣🤣
@@markus5000 trash 🗑️
@@markus5000 Carefull on calling them out. They'll try to bully you. They're CONARTIST. Notice it was edited out of the videos after this one.
I have been looking for this info. EVERYWHERE. So glad I found your channel. Thanks for the sharing.
Just wanted to say I agree with others that your way of teaching is awesome!!! I feel like I’m learning so much!!!
Thank you! :)
I’ve been trying to learn this strategy from the trading with Henry channel and they guy makes it so complicated but thanks for this simple explanation
Awesome! 😊
Markus is an excellent teacher. He is very systematic. He makes a difficult subject so easy to understand. Thank you Markus.
Thank you for the wonderful feedback! 😊
Thanks Markus , really great presentation! I use this stratagie and love it. ONE other thing about it is that commissions are minimal compared to lots of other stratagies. One commission, unless you close out early instead of 4 or 8 haha...something that brokers wont teach. please let me know if you run a class.. thanks and im following you now.
Thanks so much for your kind words and for sharing your experience with the strategy! You're absolutely right-one of the great advantages is keeping commissions low, which is a game-changer, especially for consistent traders like us. Brokers don't highlight that, but it's one of those 'insider' benefits that makes a big difference.
I have a Mastermind program where we trade together and deep dive into the strategies. I'd love to have you join one! Please reach out to social@rockwelltrading.com for more details.
Thanks for the follow-I'm excited to keep sharing more tips and insights with you!"
Hey Markus, YES DO THE COURSE! Hugo here - your friend from "Compro"
EXCELLENT explanation, thank you! Love how you toss out an impressive 43% return and then casually state you personally prefer around a 60% return! Niiiiiccceee 💪😎😎😎
LOL - Thanks, Daddy Dude! Stay in touch, and let me know if you need help with anything. 😀👍
Hello ,What broker are you using on this exercise?
Oh God, finally somebody that explain perfectly. Thannk you so mucho.
Did you launch the course?
I have a course about options here www.rockwelltrading.com/free/options-101-v1/ and you can also get the book about The Wheel Options Strategy here www.rockwelltrading.com/the-wheel-options-strategy-book/
Incredible work, brother! Hope all guys who have problems with money can solve it now🌎
Amen! ;)
Great great video! ❤ you explain so thoroughly. Slow enough for beginners like me!
Thank you for watching! ;)
You teaching is so engaging easy to understand, I’m on the wheel after learning from you 🙏👍
Awesome! Thank you for such kind feedback. 😉
Very honestly, from all the channels for option trading by far you are the best! am very happy to find you.
Hi Producer Qa, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
Thank you so much for all this information. It has really helped me a lot. I am new to options trading, but why do you say in this lesson that we need to choose a price that is $20 less than the strike price, can you give us a percentage instead?
You're very welcome! I'm pleased to know the information has been helpful to you.
When considering a price that is $20 less than the strike price, this strategy serves as a solid guideline for balancing risk and reward effectively. Additionally, using a percentage can be an excellent alternative.
For example, if you choose to work with percentages, setting your target price at a specific percentage below the strike price, like 10% or 15%, can help you remain flexible and responsive to the stock's price movements and volatility.
Ultimately, the decision between a fixed dollar amount and a percentage should align with your trading style and comfort level. The most important thing is to adopt a method that effectively helps you manage risk while striving for successful trades.
Feel free to reach out if you have any further questions or would like additional clarification-I’m here to help!like additional clarification-I’m here to help!
Great video. I’m new to trading and usually only do day trading through cheap stocks or options. Never considered actually owning stock, but now see a great benefit. You explain clearly and love the visuals. Thank you!
Keep learning! I am glad that you have started trading. ;) Thank you for watching!
This explanation on the wheel is so clear and simple. Thanks for the breakdown!
😊 You are welcome! I am glad that this helps!
Very well explained ‼I appreciate that you don't talk down to us but still give great info. This was very clear and well paced. The only problem, now, is that I have to watch all of your other videos because I'm betting you have a lot of experience to share. 🤣🤣
Lol! That is a good problem. Check my playlist for specific topics! ;)
Wow... I'm blown away with this strategy. I'll admit I'm a super beginner when it comes to trading options, but I sort of grasp what you're saying... I need to study this and inculcate it in my mind by actually doing it - it's the way I learn.
Thank you very much for your tutorial. Amazingly informative
Miguel Sanchez
You are welcome! I am glad that this helps! :)
Man, I keep stumbling back on these and learn so much.
Awesome! Thank you for watching! :)
This is perfection :) Thanks Markus, now I can share it with my buddies who think trading is rocket science.
You are welcome! I am glad that this helps! :)
You are amazing I been looking for a video that can explain this method for a while cause it was confusing as heck... you made it very easy to understand!
Hi Alexander, thanks for watching. And thanks for your feedback. Much appreciated. Have you already watched the other videos in the playlist:
ua-cam.com/play/PLBa3sAx-Io2nosgosERUhIZwzvIgD-3Vq.html
Let me know if this helps.
This is one of the most understandable, digestible expansions I've seen. Thanks.
Hi Staticks, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
What option date you open for the wheel strategy? A month out or week out for sell put?
I have learned a lot from your video, good strategy, thank you so much Markus, Keep it up!!
Awesome! Thank you for watching! :)
Great content.
New to this. Want to ask if there is a senario that we would lose money?
Yes. You get assigned and the stock continues to go down. You can't sell the CALLS because there is not enough premium. And while you can fly a rescue mission, the stock keeps going down. Then you get a margin call from your trader and you have to sell your position at a loss. Marcus's approach is to simply avoid that, which isn't really risk management.
Look I've been a Rockwell customer for years, and this is a major weakness of this trading strategy and the way they present it.
Just be aware of it.
This is by far the best explanation
Thank you for watching! Please connect with us via our social media channels for more free resources. Facebook- facebook.com/markusheitkoetter
Instagram- instagram.com/markusheitkoetter_/
Well explained, although since we are speaking plain vanilla here it would have been useful to mention that if you’re assigned the 90 C you need to have 9’000$ in your account so you are effectively -9k$ in your cash position.
not necessarily; you can close the position and roll the puts in time to collect more premium that can offset your loss; there are ways to minimize assignment risk
The problem is that if there is a panic you could lose a fortune. The price might not give you the chance to get out. I’m so confused how people think this is safe in any way.
Buying options sets your potential loss but selling options is insane. This strategy has wiped out way too many hedge funds.
I just ran a bunch of different scenarios and found my 10 grand was at risk to make 140 dollars. Not worth the risk in my opinion. Buffet must be pretty confident in the stocks he is trading.
Great video sir.. Did you end up doing an online course on this? thanks
We have this in our Mastermind Program. Please feel free to reach out to support@rockwelltrading.com if you want to learn more.
Thank you for explaining us this strategy 👏🏻 one question if I sell a put and before the expiration comes down to the price you are selling. Do I have to wait until the expiration or I can buy it as soon it pass through? Hope you understand my question and thanks again for your videos
Thank you Markus for your educational vids ! You rock !
😊 You are welcome! I am glad that this helps!
Thanks Markus, I started my wheel account 2 months ago and am already up 38%. I have been selling weekly contracts; thanks for the video it's helped me a lot!
Yeehaw! 😀😀 That's fun!
How much do you profit a week from this? I want to start doing the same. Kind of new
@@kavid8120 It's all in percentages. In general, the more volatile the stock the more premium you will you receive. Important to wheel stocks that you like and not stocks that just pay you high premiums.
I've been waiting for a video like this that explains it to me in a way I can understand... you must be a real teacher! lol
Subscribed!
Awesome! Thank you for watching and for subscribing! :)
At 7:02 what's the logic of choosing a strike $20 away?
Also at 8:18 isn't the loss from the stock $2000 and not $1000?
I really enjoyed the way you explained the wheel. It's clear and concise. Just got yourself a new subscriber
Awesome! ;) Have you watch my playlist about it? Here ua-cam.com/video/XMD5kJ62D5U/v-deo.html
I loved this video. You provide clarity. I actually understood everything you said.
Hi Michael, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
new to this, i will try this for sure, thanks
Hope you enjoy
Very easy to understand. Loved the clarity and the graphics made it that much easier. Thank you.
Hi Bill, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
So, a wheel is essentially alternating halves of a strangle??
Love it! Nice work
Thank you! Cheers!
I always stayed away from options but this video makes so much sense. I would be stupid not to sell options on stocks I already have. If I plan on selling a 100 shares of a stock at a certain price anyways in my IRA, why not collect a premium while I wait for it to hit my sell point or set it a little higher? If it triggers, not a big deal. I still make a profit I was planning on making anyways plus the free money while I waited. I did the math and I can make over $1500 a month just by waiting.
Hi A C, you are absolutely right: You can sell Calls against your stocks, as long as you don't sell more than 1 call per 100 shares you own. Hope this helps. 😀
Which stocks are you considering doing this with if you don't mind me asking? I'm currently wheeling WFC and MGM (and soon, T) but the premiums are incredibly low, unlike in the example in this video.
@@RIGHTNOW108 how has this worked for you so far? Thanks
@@cameronc7800 It's a learning process for sure. The end of 2020 and the first half of 2021, I was making 2500/mo selling puts.
Then I got burned on a few meme stocks late last year. My own fault for buying into the hype.
Now I'm being very conservative and pulling in 300-400 each month running the wheel on just a few tickers. The overall market is brutal right now
I am doing this strategy since few months. I liked your video. I agree with you about the return potential as I am achieving this with a higher percentage. :)
Hi Ranjit, thanks for commenting. Sounds like you're doing really well. Keep making money! As you know, there's not too many traders you can do that. Great job! 😀👍
Just curious as to which stocks you're running the wheel with.
Hello your teaching style is just what I need. Thank you. I am interested in the upcoming course.
😊 You are welcome! I am glad that this helps!
the wheel strategy will be hard to execute if the underlying drops significantly because the least you should sell the covered call is at the price that you bought the underlying at.
Just sell more puts
Wonderful explanation! I am new to trading and this is such a wonderful strategy to learn. Love your podcast too! Keep up the fantastic content!
Thank you! I am glad that you like this. :)
Excellent ! I use the wheel and in one year received 130k on a 200k ira investment...
That is cool! 😉
When did you go from a 30 day out option to a weekly option and why? Thank you. Love your video's and books.
Thank you for your kind words and for following my work! I appreciate that you're enjoying my videos and books.
To answer your question, I shifted from trading 30-day-out options to weekly options after recognizing a few key advantages. Weekly options give me more flexibility, allowing me to capitalize on more frequent opportunities. Instead of waiting a whole month to see the outcome, I can adjust my strategy every week, which is great for fine-tuning and responding to the market’s moves more quickly.
The real turning point for me came as I noticed that the shorter expiration periods allowed me to manage risk more actively and take advantage of smaller, quicker market moves. This shift was all about maximizing returns and staying agile in a fast-moving market. It's also in line with my philosophy of simplifying trading strategies and making them more efficient, which is at the core of Rockwell Trading.
Hope this helps, and feel free to reach out if you have more questions!
@@rockwelltradingservices thank you for the quick answer. I kinda figured that's what you thought. I used to follow another person on youtube who did the 3 week out options and I had a hard time waiting 3 weeks for the outcome. I have been following you for a few months and find that the weekly options suit me a lot better. I like the fact that I can make $50 to $200 per week without having to wait so long. Thank you!!!
So instead of 35 days expiry, can we pick a shorter expiration, like 7 days? Then we could earn more premium right??
Yep, but the premium would be a lot lower.
Hello, thank you for video. but i didnt understand 2 nd scenario when price bellow $90. in that case PUT option will be $650 and minus from owned stock $1000 so total loss if position closed -$1650. Am i correct?
Thanks for asking! Let’s break it down simply.
If AAPL drops below $90 and you own the stock, here’s what happens:
Stock Value: You bought AAPL at $100. If it’s now $90, each share is worth $90. That’s a $10 drop.
Put Option: Owning a $90 put gives you the right to sell your shares at $90. If you use it, you’ll get $90 per share, no matter the current market price.
What’s Your Loss?
Stock Loss: You paid $100, it’s now $90. That’s a $10 loss per share.
Put Option Value: If the put is worth $650, you’ll receive this when selling it.
Two Scenarios:
If you sell everything (the stock and the put), you’re down $10 per share on the stock but up $650 from the put.
If you exercise the put, you limit your stock loss to $10 (the difference between $100 and $90), minus the premium you already paid.
So yes, your understanding is spot on if you don’t exercise the put. But remember, using the put can help manage your loss.
Got more questions? I’m here to help!
I have been trading for close to 15 years now. The Wheel Strategy is the best one so far.
Thank you Markus for a great video!
My Son (44 y/o) clued me into this strategy back in early December 2020 and I have yet to lose a penny in the market. This video reinforces everything I have been shown and tried!
Awesome! Thank you for watching! :)
@@rockwelltradingservices My pleasure Sir. Anxious to see more new videos from you!
I live stream every Monday, Wednesday and Friday. See you soon!
@@rockwelltradingservices Thank you sir! Keep up the great work!
@@rockwelltradingservices Markus, Have you done a video on the "Iron Condor" Strategy?
Love this video! Thanks for the lesson Markus! Really helped me understand this concept a lot. Happy Trading!
Hi Will Dale, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
Like your no BS approach! 👍
Thank you, David.
does the wheel options strategy trigger the wash sale rule?
The wheel options strategy can trigger the wash sale rule if you sell a security at a loss and then repurchase it within 30 days.
If you sell puts, get assigned shares, and then sell calls, you might encounter wash sale situations, especially if you sell at a loss.
I'm subscribed. Love your teaching style.
Thank you! :)
My dude, you've just earned yourself a new subscriber! Thanks for the video; looking forward to seeing more!
Thank you! :)
Best video, by far, explaining the Wheel Strategy. By *far.
SUBSCRIBING.
Awesome! ;) Thank you for watching.
Thank you for sharing, simple, detail, precise and easy to understand
😊 You are welcome! I am glad that this helps!
Does it have to be 30 days put, can it be a week or 2 weeks out?
can also be a weekly, but the premiums you will get will be lower, because there is less extrinsic value in the option (less time until expiration), and this goes very fast in the end..
@@cdh79 o ok got it. Thank you so much
I just luv your videos, always informative 👍👍👍
Hi GuitarHead, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
I've been doing this too, love it. I hope my wheel gets bigger. Question. So you collect the credit aka premium up front. You then see a open position with the contract. You then see the contract fluctuate with the Market. Does that affect your premium you got paid. Or does it just effect the price you might pay or not pay to buy to close before expiration if you want?
Just keep learning and manage your risk. What tool are you using to trade the wheel?
Great Stuff - Thank you Mr. Heitkoetter. Question(s): What about the fact that you only have $1000 in your margin account? How did you buy 100 shares at $90? Also, when you implemented "The Wheel", i.e. where you sell calls. You said to sell calls at ~$20 away from the price of $90. However, you then went to the call chain, looked 30 days out, and sold the $140 strike (I assume that was because $140 was $20 above the current price of $120). Incidentally, the price for the $140 strike was $5.20, not $5.00. At any rate, couldn't you really have sold the $110 calls for $15.49, or can you not sell calls below the current price?
No response on this point, huh? Did this guy go away?
What platform should I use for options trading and is there any software I need to help me?
Hi Kyle! I am using the PowerX Optimizer. If you want more details about this, please email us at support@rockwelltrading.com and look for Cristy.
I Loved this video
Thank you1 What did you love about it?
cant wait to try this
Awesome! :) Keep me posted on how your trade goes! ;) Have you read my The Wheel Options book yet?
I'm interested and I like the wheel strategy. Thank you
Hi! Please reach out to us at Facebook facebook.com/markusheitkoetter/ or Instagram instagram.com/markusheitkoetter_/
best I have seen so far !!!!!!!!!
Thank you! ;) By the way, are you already a PowerX Optimizer user?
no how do i acces it ?@@rockwelltradingservices
If you are interested to get the PowerX Optimizer you may get it here bit.ly/441OPel and apply the promo code "Rockwellspecial". Please reach out to social@rockwelltrading.com for more details.
thanks!
Markus, I just recently discovered your channel. Very much enjoy your natural ability to convey information. You are a natural born teacher 👍
Something that has always troubled me as a new investor isn't the numbers or the "trends", it's: how do I find stocks in the first place???
There are millions of stocks. How do I figure out which ones to look for? And, more importantly, how do I look for them? (APPLICATION of knowledge is power)
If you haven't already made a video on this topic, can you?
Thanks again, hope to hear back from you!
Hi MH! If you want to know how I pick my stocks just go to mytradingroutine.com.
Fantastic video, than you for the good examples
You are welcome. I am glad that you like it.
This is an excellent strategy, Great video 😁
Thank you for dropping by. Do you like the format? You feedback is highly appreciated. ;)
@@rockwelltradingservices yes, the format is excellent I subscribed to watch more videos
Awesome! Thank you, Ben.
In the last step, do I SELL TO CLOSE or
Simply sell the shares via the basic SELL button.
Thank you
Great video.
The best one I’ve seen thus far.
Thank you for watching! :)
It should be sell to open a Call on the last step. That way you have the obligation to sell at that strike while making the premium.
If you just sell then you don't make a premium.
You cannot sell to close unless you bought to open an option (this requires you to pay a premium which is not part of the wheel strategy).
Hey Markus, love your videos! Hope you don't mind me offering two points of constructive criticism:
1). There's several typos in the video. For one, you said the put was sold for a premium of $3.20, but you wrote that the profit would be $350. Luckily I caught that it was a typo but that could throw some newbies off. Also you wrote Open &P but I think you meant Open P&L. That one confused me...I was trying to figure it out until you wrote Open P&L in the next scenario. (Side note: never actually heard that term before...I've only heard unrealized gains/losses or paper gains/losses, so that one was new to me).
2. If you're using a margin account don't you have to pay margin interest? So that would cut into your profits right? I haven't actually used a margin account personally so I don't know for sure...I thought it costed you something though. That would be another super helpful bit of info and would be an important consideration.
All in all it was a super informative video. I started dipping my toes into the wheel strategy last week, so I'm still doing research daily (but I have been a long term investor for about 10 years). Thanks for the video!!
Buenas tardes, ¿este material no esta en español?
Hi Javier, I do not speak Spanish for the auto translation is helpful. 😉
@@rockwelltradingservices gracias seguiré usando el traductor automático, thanks 😊
You are welcome! 😉
Great video, I have learned a lot from this and your other videos. I had an earlier question posted but got the answer from your "When to take Profits" video! Thank you!
Great question. You have 3 options:
1.) You could just buy it back for a few cents and then sell it again when BAC rallies.
2.) You could let it expire worthless. If you have more than 5 DTE, I would buy it back.
3.) You could roll it but you probably won't get a lot of premium since BAC is down.
I personally would do 1).
Does this help?
@@rockwelltradingservices Thanks so much for your help. I bought it back at 84% profit and repeated the process again.
Hi! Great walkthrough of the Wheel Options Strategy - Thank you ! Did you create the course you referred to in this video? Would love to see more.
Hi Suza, yes, I did create a course on this. Please contact my team at support@rockwelltrading.com, and they can give you more information. Talk soon! 👍
@@rockwelltradingservices 🙏🙏🙏
Awesome! :)
Really excellent. Thank you
Awesome! Thank you for watching! ;)
Very easy to understand. Thank you.
You are welcome! 😉
Hi…
Can we sell covered call options for far off the time…@ when it will get assigned…
Thanks
Awesome, I had never heard of this strategy.
Now you know. ;)
Hey how is your exit setup for option selling? Like when do you take profit and cut loss, in terms of percentage thanks
Great question. I made a video in which I explain it: ua-cam.com/video/W7q_lD5DXng/v-deo.html
Does this help?
for closing strike 100 put option we need to pay out 650 dollars or should sell the stock ,how without closing the put option or selling stock we can keep 650 dollars as unrealized ..makes no sense to me ..kindly reply
Fantastic explanation. The onscreen notes are just the way i like to learn.
Awesome! :)
it is awesome video Markus, even somone who dont knows anything about wheel (actually it is me :)) can understand what it is.
I only wonder after 70 day if stock is below 80 dollar so what you do ? just waiting stock to go up above 100dollars or dont youopen new option ?
I'm gonna apply this to MSTR! But I'm a bit not sure about the margin. How does broker charge you on that? Is it worth it?
Perfect. Love the specific examples and use of step by step charts
Hi Caleb, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
thanks.. very clear to me now
Awesome!
Nice video by I still need time to digest. Will repeat watching
Yes, repetition is the mother of learning. ;)
What does it mean by 1000$ in margin? Does it mean that they will loan you that amount of money or will that just being down your total payment if your assigned to 1000
Yes, it means that they loan you $1,000.
You’re videos are great please keep it up!
Hi jimy2me, thanks for watching. And thanks for your feedback. Much appreciated. "See you" in the next video 👍
So what you are saying is that I can use the margin to sell puts? And if I get assigned and borrowed that money, then what?
you need to have the money to eventually buy the 100 stocks if you're assigned.. so don't do it if you don't have the money to actually buy 100 shares (which you should have for this strategy, as your initial plan was to buy 100 shares in the first place).. don't sell naked puts, where you don't have the money to pay for the shares that you want, or you'll have a bad day when you get assigned..
the margin account just requires less margin (so you could do other trades in the meantime) and don't need the full amount at the time of placing the order..