Why this challenge, why now
In honor of two things happening at once — the launch of TraderVoila.com and the first day without PDT restrictions — I decided to start a real, documented $500 Wheel Challenge. The goal is simple: generate 25% annually on a small account using the wheel strategy, with as low risk as possible.
I'll say upfront: I'm not a risk-averse trader. Some of my decisions will look aggressive to more conservative traders, and that's fine. Operate within your own comfort zone. This challenge is meant to show you how the wheel works in practice — wins, losses, rolls, and all — not to tell you exactly what to trade.
$500 starting balance. Target: 25% annually (~$125/year, ~$10/month). Strategy: wheel — selling cash-secured puts, rolling when needed, selling covered calls if assigned. All trades documented in real time.
Why TastyTrade for a small account
I chose TastyTrade for this challenge for a specific reason that matters a lot on a small account: their margin rules are different.
Most brokers won't let you sell puts on a $6 stock if you only have $500 in your account — even though they'd happily let you buy $600 worth of shares on margin. TastyTrade's margin framework is built for options sellers, so I was able to sell puts on BULL (trading at ~$6) with only $500 available. That opens up stock choices that would be off-limits at other brokers.
The other reason is TastyTrade's fee structure. They don't charge commissions to close trades — so the closing leg of a roll is free. You do pay a commission on the opening leg of the new position, but eliminating the closing fee cuts the cost of rolling roughly in half compared to brokers that charge both ways. On a small account where you might be rolling frequently, that adds up.
The TastyTrade link above is a referral link. I use TastyTrade myself — that's the only reason it's here. Shop around and use whatever broker fits your needs.
Why BULL as the starting stock
BULL is Webull's own stock (ticker: BULL), trading on the Nasdaq. Here's why it made sense as a starting point for this challenge:
- Price range: Trading around $6 — close enough to my target that a $6 put strike made sense, and affordable enough that assignment (buying 100 shares) is manageable on a small account
- Liquidity: Average daily volume over 14 million shares — critical for options trading. Thin volume means wide bid/ask spreads, which eat into your premium before you even start
- Recent support: BULL had bounced off $5.90 and $5.84 on recent pullbacks — giving me a technical reason to feel comfortable with a $6 strike, since those levels represented real buying interest
- Comfort with assignment: If I get put the shares, I'm comfortable holding BULL and selling covered calls against it. That's the whole point of the wheel — only sell puts on stocks you'd actually want to own
The trade: same-day puts on a volatile day
On June 5, 2026 — the first trading day after PDT restrictions were eliminated — I opened the challenge by selling 1 contract of the BULL $6 Put expiring that same day for $0.10 in premium ($10 total).
Yes, same-day expiration is aggressive. The premium is thin and there's no time buffer if the stock moves against you. But BULL was trading right at $6.01 at open, the support levels looked solid, and for a challenge article — day one of a new era without PDT restrictions — it felt like the right call. Sometimes you eat the theta, sometimes it eats you. Today, it ate us.
The roll: navigating a 2.58% market drop
The market had other ideas. The S&P 500 dropped 2.58% throughout the day — the kind of move that only happens 5-7 times a year, but when it happens, it happens fast. BULL slid into the $5.70s, well below my $6 strike, and it became clear I didn't want assignment at these prices.
This is where the wheel strategy shows its real advantage. If I had been buying short-dated calls or selling short-dated spreads directionally, I'd be sitting on real losses right now. Instead, I had a put I could roll.
Rolling means: buy back the put you sold (closing the position), and simultaneously sell a new put at a further expiration date — collecting additional credit to offset the cost of closing. I set up a rolling order and collected an additional $0.14 per share ($14 total) to move the expiration out to June 18, 2026.
In a perfect world, I want premium collected to bring my average cost per share down close to the actual stock price before I accept assignment. Taking shares at $6.00 when the stock is trading at $5.70 means I'm immediately underwater. Rolling gives the stock time to recover and keeps accumulating credit in the meantime.
Where we stand heading into 6/18
We're now holding a BULL $6 Put expiring June 18, 2026 with $24 in total premium collected. Our effective cost basis if assigned is $5.76 — meaning if BULL is anywhere above $5.76 at expiration, we're in decent shape.
The plan from here:
- If BULL recovers above $6.00 by June 18 — the put expires worthless, we keep all $24, and we start fresh with a new position
- If BULL is between $5.76 and $6.00 — we may roll again for more credit, depending on what the premium looks like at the time
- If BULL stays well below $6.00 — we'll evaluate assignment. If we take shares, we'll start selling covered calls immediately. We won't sell calls below our cost basis of $5.76, and ideally not below the $6 strike we were assigned at
We will never sell covered calls below our average cost per share. That's how you lock in a guaranteed loss. The covered calls go above cost basis — always — so that if shares get called away, we exit at a profit or breakeven, never a loss.
Week 1 didn't go smoothly — but that's kind of the point. The market dropped hard on day one of the challenge, and we're still standing with $24 collected and a clear plan. Check back after June 18 for the Week 2 update.
What if you have more than $500?
If you're following along but have a larger starting balance, the same thought process applies — just with more flexibility. You can sell multiple contracts of $BULL to scale the position proportionally, or you can apply the same strategies and decision-making laid out in this post to another ticker within your own circle of competence. The mechanics are identical — the only thing that changes is position size and stock selection.
Whatever you trade, stick to the same rules: stocks you understand, support levels you believe in, and strikes you'd be comfortable getting assigned at. More capital doesn't mean more risk — it means more options.
If you decide to open a TastyTrade account, please consider using my referral link: https://tastytrade.com/welcome/?referralCode=WZQW7D42HS
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