My $HOOD Adventure: Spinning The Wheel for Profit

 Hey options traders! I'm excited to share my recent experience with "The Wheel" strategy on Robinhood ($HOOD) stock. Let's dive into the details of this thrilling options journey.

The Setup

It all started on January 6, 2025, when I sold a cash-secured put on $HOOD:

I got assigned 100 shares at $41 each. My initial cost basis? $40.50 per share ($41 - $0.50 premium).

The Covered Call Carousel

With shares in hand, I jumped into the covered call game. Here's how it played out:

The Results

After this whirlwind of activity, here's where we stand:

1. Total premium collected: $427 ($50 from put + $377 from calls)
2. New adjusted cost basis: $36.73 per share ($40.50 - $3.77)
3. Potential profit if called away at $42: $5.27 per share or 14.35% return

Key Takeaways

1. Active Management: This strategy kept me on my toes, requiring frequent adjustments.
2. Income Generation: $427 in premiums over just 11 days .
3. Cost Basis Reduction: I effectively lowered my purchase price from $41 to $36.73.
4. Flexibility: I adjusted strike prices based on $HOOD's movements, balancing income and upside potential.

Risks and Considerations

• Capped Upside: If $HOOD skyrockets, my gains are limited to $42 per share.

Conclusion

The Wheel strategy on $HOOD has been an quite a ride, offering consistent income and reducing my cost basis. While it requires active management and comes with its own set of risks, for me, the rewards have been worth it.Remember, this is just my experience. Always do your own research and consider your risk tolerance before diving into options trading.

 Happy trading, and may the odds be ever in your favor!