Free calculator · Options & volatility · free account
Wheel strategy calculator
A wheel is a sold put and then, if the shares are assigned, a sold call against them. Planners usually show one number: premium per cycle multiplied by cycles per year. This shows all three ways a single cycle can end, including the one that multiplication leaves out.
These calculators do arithmetic on numbers you enter. They do not produce recommendations, do not connect to any market feed, and do not know what any instrument is worth — that is never advice, and it is not a substitute for your own judgement or a licensed professional's.
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to use the wheel strategy calculator — and the other 12: Position Size, Risk : Reward, Margin & Leverage, Drawdown, Options Payoff, Monte Carlo, Delta-Adjusted Sizing, Theta Decay, Expiry Probability, IV Rank, Earnings Move, Candlestick Anatomy
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How this is calculated
No hidden model and nothing fitted to data. Every figure on this page comes out of these lines, applied to the numbers you typed.
collateral = put strike × units
basis if assigned = put strike − put premium
basis after call = basis if assigned − call premium
called away = ( call strike − basis after call ) × units
held at price P = ( min(P, call strike) − basis after call ) × units
loss at zero = basis after call × unitsMore free calculators
Options Payoff
Where does this position break even, and what is the worst case?
Theta Decay
How fast does this option's time value disappear?
Expiry Probability
Under this volatility, how likely is each outcome at expiry?
IV Rank
Where does this volatility reading sit against its own history?
Earnings Move
What move is priced in, and what does the crush cost?
Position Size
How many units does my risk budget actually buy?
Frequently asked questions
- How does the wheel strategy work?
- It is two option sales in sequence. First a cash-secured put: you sell a put and set aside enough cash to buy the shares at the strike. If the put expires with the stock above the strike, you keep the premium and nothing else happens. If it is assigned, you buy the shares at the strike, then sell a covered call against them. If the call is assigned, the shares are sold at the call strike and the cycle closes.
- Why is there no annual income figure?
- Because the only way to produce one is to multiply a single cycle's premium by a count of cycles and assume every cycle completes at the same premium. The cycles that do not complete that way are the ones where the stock fell through the put strike and the shares are now held below what was paid for them. A yearly figure built by repetition describes only the path where nothing goes wrong, so this page shows every branch of one cycle instead.
- What is my cost basis if the put is assigned?
- The put strike less the put premium, per share. Selling a call afterwards lowers it again by the call premium. On a 95 put sold for 2 and a call sold for 1.50, the basis is 93 after assignment and 91.50 after the call. The calculator shows both, because the second only exists once the call has actually been sold.
- What happens if the stock keeps falling after assignment?
- Then the position behaves like owning the shares, because it is owning the shares. The premiums lower the basis by a fixed amount; they do not put a floor under the price. The calculator shows the loss if the shares go to zero — the basis after both premiums multiplied by the number of shares — which is the same downside as buying the stock outright at that basis.
- What if the call strike is below my cost basis?
- Being called away at that strike realises a loss on the shares, which the call premium may or may not cover. The calculator flags it whenever the figures you enter produce it. Whether that trade-off is acceptable is a decision about your own position, and it is not one this page makes.
- Is any of this sent anywhere?
- No. The arithmetic runs in your browser as JavaScript on this page. Strikes, premiums and contract counts are never transmitted, never stored and never logged, and closing the tab discards them. A free account unlocks the calculator; it does not send anyone your numbers.
⚠ Important disclaimer
These calculators are provided strictly for educational and informational purposes. They perform arithmetic on figures you enter. Nothing on these pages is financial, investment, trading, legal or tax advice, nor a recommendation to buy, sell or hold any security, derivative, commodity or cryptocurrency.
The creator is not a registered investment adviser, research analyst or broker with the SEC, FINRA, CFTC, NFA, any U.S. state securities regulator, or SEBI (as an Investment Adviser or Research Analyst). Trading involves substantial risk of loss — you can lose some or all of your capital, and with leveraged instruments you can lose more than you deposit.
Contract specifications, lot sizes and margin rates shown here are seeded from published standards, are editable, and may be out of date or wrong for your broker. Exchanges revise lot sizes and margin requirements, and brokers routinely impose more than the regulatory minimum. Verify every figure against your own broker before acting on it. These tools carry no warranty of any kind and may contain errors.
You are solely responsible for your own decisions. Read the full legal disclaimer →