RTX got assigned. I sold a covered call the next day. Here’s why I’m still thinking about it.
Real trades. Real money. Documented live.
— This week’s scoreboard is live on the Start Here page.
Last week I told you RTX was going to assignment and that was always the plan. It happened exactly as expected. I own 200 shares at an effective basis of $186.34.
The day the shares landed in my account, I sold a covered call.
$190 strike. June 18 expiry. $0.91 premium. Two contracts.
$182 total.
That’s it. And I’ve been thinking about whether I should have done it.
The two schools of thought
When a stock gets assigned and you’re sitting on shares, you have two choices. There’s no universal right answer. Every operator picks their own approach — but you need to know what you’re choosing and why.
School 1: Sell the call. Every time.
This is the Tasty Trade philosophy. You own the stock, you sell the call, you don’t debate it. Holding shares uncovered means theta is working against you with nothing to show for it. $182 beats $0. The premium is thin because RTX’s IV is low right now — that’s not a reason to wait, that’s just what the market is offering. Your job is to show up and collect it every cycle. The process is the edge. Not your opinion about whether RTX will bounce next week.
School 2: Sit on it. Wait for the stock to recover.
RTX is at $175. My effective basis is $186. The stock needs to rally $11 before I’m whole on the shares. If I sell the $190 call and RTX runs to $200, I’m capped at $190 — I miss $10 of recovery for $0.91 per share. The counter-argument: you put RTX in the wheel because you’d want to own it. Defense spending is a long cycle. If you believe the stock is undervalued at $175, selling a call that caps your upside for $182 is a real cost. Sometimes the right move is to let the thesis play out.
The choice I made — and what it says
I sold the call. $190C, June 18, $0.91. Not because I’m certain it was right. But because I don’t know when RTX recovers, and $182 in hand beats a thesis in my head. The $190 strike at least sits above my effective basis — so if the shares get called away, the math works.
What I won’t do: sell a call below my effective basis just to chase more premium. That’s the one hard rule regardless of which school you follow.
Neither choice is wrong. They reflect different things you believe about the stock. School 1 is more systematic. School 2 requires more conviction. Pick one and be consistent.
JNJ turned the same week
JNJ also went to assignment on May 15. 300 shares at an effective basis of $225.69.
Different situation, cleaner call. JNJ at $228.90 — stock is holding above my basis. I sold the $240 call, July 17, at $3.44. Three contracts. $1,032 total. More room, more premium, less debate.
That’s what a clean wheel entry looks like on the CC leg. RTX is the messier version. Both are running now.
What closed
Quiet week. Two closes, both at target.
Goldman Sachs $870 put — 50% profit. IBIT $45 call — 53% profit. Both hit their GTC orders automatically. I was golfing. That’s the point.
Full detail on the Start Here page.
What I opened
Nothing new this week.
VIX is at 17.8. That’s the low end of the range — premiums are thinner across the board, not just on RTX. I have capital sitting in the money market earning yield while I wait for better setups. Deploying into thin premium to stay busy isn’t a strategy. It’s impatience.
New entries coming next week.
What to watch
CCJ is the one to watch. Stock slipped below the $110 strike — it’s sitting ITM right now. That position needs attention and I’ll have a decision to make before the June 18 expiry. More on that next week.
MCD is close to the strike as well. Both are on the radar.
OXY and WMT are both approaching 50% profit with 30 days left. Those GTCs are working.
Full scoreboard on the Start Here page.
— Keith
The Income Wheel | theincomewheel.com
Real trades. Real money. Documented live.
Nothing here is financial advice. I’m documenting how I personally trade — not telling you what to do with your money.