How I Collected An Additional $447 In Aug 22

It is the end of the month, and I wanted to start tracking how much cash flow I have been collecting from options using the wheel strategy.

At the same time, I have been tracking my monthly expenses. I set a goal that the cash flow that I am collecting, should be at least three times my monthly expenses. This way I should be able to leave my job comfortably. This means if my expenses is $2000/month, I should expect to have at least $6,000 in monthly cash flow.

For the month of August, I didn't collect as much cash flow as I used to have - it was only a total of $447.

Here's the breakdown of the trades I have done.

In the month of August, I sold a total of 5 options and collected a total of $447. All of them expired, except for the last position which expiry date is 16 Sep 22 - two weeks from now (at the point of writing).

I will show you how I will execute the wheel strategy if this position gets exercised (hopefully it does - because that's where you will collect even more cash flow).

How To Execute The Wheel Strategy

The details of how to execute the wheel strategy has been covered in another blog post. Basically, this strategy is about cash flow collection rather than stock ownership. Hence, we need to sell call options whenever the stock get exercised.

Personally, I do use a conservative amount of margin, to sell my put options. Because, by using InteractiveBrokers, the amount of cash flow I collect easier outweigh the amount of margin interest that I need to pay to interactive brokers.

If you like to find out more about the Wheel Strategy, you can read up more here.