Wheel Strategy Tool
Wheel Strategy Calculator
Calculate returns for every phase of the wheel
Input a stock price, strike, and premium to see your return on capital, annualized yield, cost basis after assignment, and full-cycle profit potential. Adjust the numbers to compare different scenarios.
Calculate Your Wheel Returns
Put phase
Call phase (if assigned)
Put phase results
If assigned
Full wheel cycle
How to Use This Calculator
Start with the put phase. Enter the current stock price, your target strike price (below the current price), the premium you'd collect, and the days to expiration. The calculator shows your return on capital for that single contract and the annualized equivalent.
If you get assigned, the "if assigned" section shows your effective cost basis (strike minus premium), the break-even price, and how much cushion the premium provides against a decline from the current price.
The full cycle section models what happens if you complete the entire wheel strategy — sell the put, get assigned, sell a covered call, and have your shares called away. It combines both premiums plus any capital gain into a total cycle return.
Key metric: return on capital
Return on capital (ROC) is the most important number for comparing wheel opportunities. A $50 stock with a $0.80 premium and a $100 stock with a $1.40 premium might seem comparable, but the ROC tells the real story: 1.6% vs. 1.4%. The cheaper stock generates more income per dollar of capital at risk. Always compare ROC, not raw premium dollars.
What Good Looks Like
Not every trade is worth taking. Here are the benchmarks experienced wheel traders use to filter opportunities:
- Minimum ROC per cycle: 1.0% or higher. Below that, the premium doesn't justify tying up the capital. Many traders target 1.5%–2.5% per 30-day cycle.
- Annualized ROC: 12%–24% is a realistic range for quality stocks in normal volatility. Claims of 40%+ annualized are either cherry-picked or involve excessive risk.
- Downside cushion: At least 3%–5% below the current stock price. If your strike is within 1%–2% of the current price, you're not giving yourself enough room for normal price fluctuations.
- DTE sweet spot: 30–45 days. This range maximizes theta decay (time value erosion) relative to the time you're exposed to risk.
For a deeper look at which stocks meet these criteria, explore our guide to the best stocks for the wheel strategy or learn about the scoring methodology that Wealth Engine Pro uses to identify candidates automatically.
Go Beyond the Calculator
This calculator models a single trade. Wealth Engine Pro evaluates thousands of potential trades every day — scoring stocks, identifying optimal strikes, and producing AI-driven analysis of the best put-selling opportunities. Stop running numbers manually and let the system do the heavy lifting.