One full turn of the wheel: a put sold and assigned, then a call sold on the shares and called away. Total premium, the cost basis after each leg and the return on the cash it took.
| Price at the call's expiry | Profit or loss at expiry |
|---|---|
| $39.54 | -$376.00 |
| $43.30 | $0.00 |
| $47.00 | $370.00 |
| $50.76 | $370.00 |
The wheel repeats two income legs. A cash-secured put is sold; when it is assigned the shares arrive at the strike, and a covered call is sold against them; when that is assigned the shares leave at the call strike and the cycle starts again.
Each premium lowers the cost basis of the shares, which is why the basis is shown after each leg. The chart is the whole cycle at the call's expiry: shares bought at the put strike, the put premium already in hand, and the short call on top.
This page assumes the cycle completes: assigned on the put, then called away. In practice a cycle may take several calls before the shares are called, and each extra call lowers the basis again.
How assignment premium enters the share basis · Wash sales on options · every calculator
Every price here is one you typed; nothing is fetched and nothing is stored. The numbers travel in the address of this page, so a result can be linked to. Results are at expiry for one structure, before commissions and fees, and assume no early assignment. An illustration of the arithmetic, not advice.