The wheel strategy
Since I can’t wait for the market to open here is a short guide on how one can generate income by simply waiting and holding shares or cash:
Step 1: Sell Cash-Secured Puts
Choose a stock you’re willing to own and sell a put.
If it expires above your strike, you keep the premium.
If it drops below, you’re assigned shares at a discount.
Step 2: Sell Covered Calls
Once you own the shares, sell call options.
You collect premium while holding the stock.
If the stock rises above your strike, your shares are sold for a profit.
Then repeat the cycle.
Why use it:
• Consistent premium income
• Works best in neutral to slightly bullish markets. When volatility is high combined with key levels, selling puts and calls is my go to.
Risks:
• Holding a declining stock (which is why you should do it on stocks you already plan to hold)
• Limited upside when selling calls. I prefer selling calls that are way out of the money so I don’t miss out on big moves up.
Simple idea: get paid to enter, get paid to hold, get paid to exit.
