Quick recap — where we left off
Trade 1 of the challenge was on $BULL. We sold cash-secured puts at the $6 strike, navigated a rough first day that forced a roll, and then watched the stock climb all the way to $7.00. We closed the position for $0.01 on June 15 and netted $20.49 on the trade.
Closing BULL early rather than waiting for the June 18 expiration did two things: it eliminated all remaining risk on the position, and it freed up capital immediately — meaning we could put that money to work on the very next setup we liked instead of sitting flat for three days.
Why SOUN for Trade 2
SoundHound AI ($SOUN) is an AI voice commerce company — it powers voice assistants for restaurants, automotive, and enterprise applications. It's not a fundamentals pick by traditional metrics. Like $BULL in Trade 1, this is a speculative name: high retail interest, good options liquidity, and more volatility than a boring blue chip.
We're eyes open about that. The challenge isn't meant to be a model portfolio of quality value stocks — it's a documented, real-money options income series. Speculative names with liquid options and meaningful premium are exactly what makes the math work on a $500 account. The key is picking your strike carefully and never selling puts on a stock you'd refuse to own if assigned.
What made SOUN attractive on June 16:
- Stock was down roughly 5% on the day — a meaningful pullback, not a random drift
- RSI had dropped to the low 30s — genuinely oversold on both daily and intraday timeframes
- Price was sitting near established support in the $6.60–$6.80 range, having bounced off similar levels before
- No earnings until August — clean calendar with no binary event risk before expiration
- Liquid options market with reasonable bid/ask spreads
SOUN doesn't meet the strict fundamental criteria we'd normally apply to wheel candidates — it's unprofitable with no positive free cash flow. For the challenge, we're making a deliberate exception. The account size and premium requirements push us toward more liquid, active names. We acknowledge SOUN is a speculative pick and size accordingly.
The trade details
On June 16, 2026 with SOUN trading at $6.97, we sold the $6.50 put expiring June 26 for $0.13 in premium — $13 per contract.
The $6.50 strike sits just below that support zone, meaning the stock would need to break through established buying interest AND keep going to put us in trouble. With RSI at 33 and a 5% down day already in the books, the risk/reward felt reasonable.
A note on fees and trade frequency
One thing worth being transparent about: TastyTrade charges $1 per contract to open a position, with closing trades free. On a $13 premium trade, that $1 commission is 7.7% of your gross profit before the trade even moves — a meaningful slice on small premium.
Going forward, the challenge will target biweekly expirations and aim for a minimum of $0.20–$0.25 in premium per contract. That keeps commission costs to a more manageable 4–5% of gross premium. The SOUN trade at $0.13 was a slight exception — it only exists because closing BULL early freed up capital and the setup was there. We didn't want to let a clean entry pass just because the premium was a touch thin.
On a $500 challenge account running one contract at a time, fees are a real factor. $1 to open + $0.12 in exchange fees = ~$1.12 per trade entry. Target premium of at least $0.20+ per contract going forward to keep fees under 6% of gross. Weekly options rarely pay enough to justify the friction.
Where we stand
As of today SOUN is trading around $7.01 — slightly above our entry price and well above the $6.50 strike. The position is comfortable, RSI has recovered somewhat from the oversold lows, and there are 8 days left to expiration with theta working in our favor every session.
If SOUN closes above $6.50 on June 26 the put expires worthless, we keep the full $13, and the running challenge total moves to $33.49. We'll look to roll or close early if the opportunity presents itself — same playbook as BULL.
We'll update when something happens worth writing about — a roll, an early close, or expiration on June 26. No update means the position is grinding along quietly, which is exactly what we want.
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