The wheel is turning. RTX goes to assignment Friday.
Real trades. Real money. Documented live.
→ This week's scoreboard is live on the Start Here page.
Last week I said RTX was going to assignment and that was always the plan.
This Friday it happens. The $190 put expires May 15. I'll own 200 shares at $190. The stock is at $177. That's $13 below my strike.
Here's what I'm doing once I own those shares.
The second leg
Once I own the shares, I'll sell a covered call against them. The strike and timing depend on where things stand at that point — where the stock is trading, what the premium looks like, whether the thesis still holds. Next week's issue shows exactly what I sold and why.
Why the effective basis matters more than the premium
When you get assigned on a put, your cost basis isn't the current stock price — it's the strike you were put at minus the premium you collected. That number is your floor.
Selling a covered call below that floor means you've agreed to sell your shares at a loss if they get called away. Doesn't matter how much premium you collected on the call — the math works against you.
So before I look at what the premium is, I look at where my floor is. Any strike below it is off the table regardless of what it pays.
That one rule changes how you think about the whole second leg. You're not chasing the highest premium — you're finding the right strike above your basis and collecting whatever that pays. Sometimes it's thinner than a fresh entry. That's the real cost of a stock that moved against you.
This only works on stocks you're genuinely willing to own at your cost basis. If the thesis changes after assignment, the right move is to sell the shares and redeploy — not keep selling calls on a stock you no longer believe in.
This is how the wheel grinds back — patiently, above your effective basis, one premium at a time.
What closed last week
Three positions closed at target last week.
Disney $95 put — 52% profit. Newmont $100 put — 56% profit. Oracle $140 put — 50% profit. All three hit their GTC orders and closed automatically. I didn't touch them.
Full detail on the Start Here page.
What I opened
With those three positions closed, two new puts went on last week.
Carrier Global (CARR) — $62.50 put, June 18
Stock at $66. Carrier makes the HVAC and refrigeration systems that go into data centers, commercial buildings, and cold storage. The data center buildout is a real, multi-year capital cycle — and every one of those facilities needs cooling infrastructure. Not a speculative bet. $62.50 strike gives a 5.6% cushion with 38 days to run.
Newmont (NEM) — $105 put, June 18
A new position in a name I just closed at 56% profit. Fresh entry, higher strike, wider cushion. Gold is holding above $3,000 and Newmont generates real cash flow at current levels — this isn't a gold speculator, it's a business. $105 strike, $118 stock. Both have GTC orders at 50%.
What to watch
RTX expires Friday. The assignment is the event. Next week I'll show you the covered call I sold the first day I owned the shares — the exact strike, the exact premium, and whether the math worked out as planned.
JNJ also expires Friday, also ITM. That decision is coming too.
GS $870 put has already captured 35% of the premium with 37 days left. NEM is at 29%. Both running clean.
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.