The wheel is a repeating cycle. The system runs it on each of your approved symbols independently.
The cycle
You hold no shares in the symbol. The system sells a cash-secured put and collects premium.
The put expires out of the money. You keep the full premium. A new put is sold on the next entry run.
The put expires in the money. You're assigned 100 shares per contract at the strike price. You keep the premium regardless.
You now hold shares. The system sells a covered call against them and collects more premium.
The call expires out of the money. You keep the premium and keep the shares. Another call is sold.
The call expires in the money. Your shares are sold at the strike. You're back to cash, and the cycle restarts with a new put.
Premium is kept at every step, whether contracts finish in the money or out.
Assignment isn't a failure
This is the most common misunderstanding. Being assigned means the strategy is working as designed — you bought shares at a price you'd already decided was acceptable, having been paid to agree to it. The system then earns more premium selling calls against those shares.
The risk isn't assignment. It's being assigned in a symbol that keeps falling, leaving you holding shares worth less than you paid. That's why your approved symbol list should contain only companies you'd be content to own.
It never closes early or rolls
The system does not buy back contracts, roll them forward, or exit early. Every contract is held to expiration.
This is worth understanding before you deploy. If a position moves against you, the system holds it. There's no stop loss on a wheel position — the defence is your choice of symbols and delta, not an exit rule.
You can always close a position yourself. See Closing a trade manually.
One position per symbol
The system won't open a second contract on a symbol that already has one open or pending. Each symbol runs its own cycle at its own pace, and your allocation spreads across the list rather than stacking on one name.
A worked example
AAPL at $200. The system sells a 60-day put near 30 delta, strike $190, collecting $350 in premium.
The put expires in the money. You're assigned 100 shares at $190. The $350 premium is yours.
The system then sells a 60-day call at $210, collecting $280.
The call expires in the money and your shares are called away at $210. You keep the $280, plus $2,000 on the shares themselves.
Total for the full cycle: $2,630. AAPL is now flat again, and a new put is sold.
This illustrates the mechanics on a favourable path. Had AAPL fallen to $150 after assignment, you'd be holding shares worth $15,000 against a $19,000 cost basis, with the covered call setting unable to find a strike above your basis. The premium collected offsets some of that, not all of it.