The wheel on LLY
Running the wheel on LLY at the August 3, 2026 snapshot meant securing $101,500 against the $1,015 put, collecting $1,940, and, if assigned at a $995.60 basis, writing the $1,265 call for another $1,500. That is $3,440 of premium across 64 days on $101,500 of capital.
Numbers on this page come from a snapshot taken on August 3, 2026. They are not live quotes and are not refreshed when you load the page.
| Cash secured | $101,500 | the $1,015 put, 32 days out |
|---|---|---|
| Put premium | $1,940 | yours the moment it fills |
| Cost basis if assigned | $995.60 | strike minus the premium per share |
| Call written above basis | $1,265 | 32 days out, $1,500 |
| Premium, both legs | $3,440 | over 64 days |
| Return on the capital | 3.39% | about 19.3% annualized |
| If the call is assigned too | 28.02% | premium plus $250.00 a share of gain |
Both legs are real rows from the August 3, 2026 snapshot: the put closest to 30 days out in the target delta band, and the nearest call above the cost basis that assignment would leave you with. Writing a call below that basis is the mistake that turns a wheel into a slow liquidation, so the exit leg here is picked to be above it.
Both sides of the bar
What the premium is priced off
44% at the money is well above a market-average tape. You get paid more here. You get paid more here because it moves more.
Dates that matter in this window
Earnings land inside the 45-day window. That is the one date that reliably breaks a premium-selling trade: the stock gaps, the strike you picked on a probability model turns out to have been picked on the wrong distribution, and the vol you sold collapses to reward the buyer instead of you. The engine deducts heavily for it. An ex-dividend date falls inside the window too. On the put side that cuts the other way: the drop on the ex-date is priced into the option already, and early assignment on a short put is driven by extrinsic value running out, not by the dividend.
Where this cycle goes wrong
The cycle above assumes two things that are true most of the time and catastrophic the rest of it. First, that assignment happens near the strike rather than far below it: if LLY is at $781.58 on expiry day you still buy at $1,015, and the $1,940 you collected covers about 8% of the hole. Second, that a call above your basis is still worth writing after the drop. It usually is not. $1,265 calls on a stock that just fell to $781.58 pay close to nothing, and that is the moment the wheel stalls: you own shares, you are down, and the only strikes paying real premium are below your cost basis.
Sitting on the shares and writing nothing is a legitimate move. Wheeling below your cost basis for a small credit is how a good strategy becomes a slow, expensive one.
Questions people actually ask
How much capital does the wheel on LLY need?
$101,500 per contract at the $1,015 strike, and that is the floor rather than a comfortable size. One contract is the whole position, so a single gap is your entire LLY exposure. Most people running this seriously want several times the capital of one cycle so the position can be sized down rather than skipped.
Is LLY a good wheel stock?
The honest filters are: would you own 100 shares of it, is the chain liquid enough to get out of, and does the premium pay you for the gap risk. On the August 3, 2026 snapshot the at-the-money implied vol was 44% and the stock paid about 0.6% a year while you hold the shares. Those are inputs. The decision is yours, and this page is not making it.
What happens if LLY keeps falling after assignment?
You own the shares at your cost basis and the market does not care what that number is. The wheel does not protect against a decline, it just gets you in a little cheaper than a buyer at the current price and pays you to wait. That is the entire edge, and it is small. See the wheel calculator to run the cycle with your own basis.
None of these is a pick. This is a dated snapshot of the LLY chain from August 3, 2026, and an option chain from last week is history, not a quote.