This is Part 2 of our Continuous Wheel Strategy series on Apple (AAPL). In Part 1, we sold a cash-secured put on Apple. Now, a week later, we've been assigned on that put - which means we now own 100 shares of AAPL stock.
Getting assigned is a normal part of the wheel strategy, and it's actually what many traders hope for when selling cash-secured puts on stocks they want to own. But once you're assigned, you need to properly track that transaction to maintain accurate cost basis records.
In this tutorial, we'll walk through exactly how to record a put assignment in MyATMM, and more importantly, we'll discuss the critical difference between "cost basis" and "cost basis with premium" - a distinction that has major implications for how you select your covered call strikes going forward.
When you get assigned on a cash-secured put, your brokerage account statement will show the assignment transaction with the dollar amount. You can use that information to track it in MyATMM, but the platform also helps streamline this process.
From your MyATMM dashboard, go to the Performance tab and select Cost Basis. Find the ticker you were assigned on - in our case, AAPL is showing by default since it's the only position we have.
Scroll down to the Puts section where you'll see the cash-secured put you sold. In our example, we sold the put on November 3rd with a $270 strike, and we're simulating being assigned on November 10th.
Click on the Result dropdown for that put position and select "Assigned". This tells MyATMM that your put was exercised and you now own the shares.
Review the proposed assignment record:
Click Submit to add the record to your Stocks position. Note that MyATMM intentionally doesn't delete the original put record automatically - this gives you control to make any adjustments before you manually delete it.
After submitting, expand the Stocks section to verify the assignment entry appears with all the correct details. Then click Save on the Stocks section to generate a proposed transaction record.
Finally, click Copy on the proposed record to fill in the transaction form, verify it's marked as a "Stock" type, and click Add Transaction to permanently record it in your history.
You'll notice there are no commissions or fees on the assignment transaction. This is typical for Schwab (Thinkorswim) - they don't charge fees on option assignments.
However, other brokerages may handle this differently. For example, Tastytrade historically charged a small fee ($1-$5) for assignments. If your broker charges assignment fees, you can add those to your transaction in MyATMM to keep your records accurate.
This is perhaps the most important concept to understand when running the wheel strategy. After recording your assignment, you'll see your position summary at the top of the Cost Basis screen showing several key metrics:
Cost Basis is simply what you paid for the stock - in this case, $270 per share ($27,000 total for 100 shares).
Cost Basis With Premium factors in the premium you've collected from selling options. Since we received premium when we sold the cash-secured put, our "true" cost basis is lower than $270.
Here's where it gets interesting, and where traders often differ in their approach. When selecting strikes for your covered calls, which cost basis should you use?
The argument for using "cost basis with premium": This is technically your true cost. If you sell covered calls above this level, you're guaranteed a profit if called away.
The argument for using regular "cost basis": If you're trying to generate income from premium, using the lower cost basis with premium as your strike target means you're essentially just breaking even. The premium you collect is your profit - if you keep lowering your target strike based on premium collected, you're not actually making money you can spend.
After recording the assignment, let's look at how your overall portfolio metrics change on the Dashboard.
Your brokerage balance (cash/sweep) decreases because you used $27,000 to purchase the AAPL shares. This is the "cash secured" part of the cash-secured put - that money was set aside for this exact scenario.
You'll now see your stock cost reflected in the portfolio. The current market value may differ from your cost if the stock has moved since assignment.
The dashboard will show your unrealized gain or loss based on the current stock price versus your cost basis. Remember, this fluctuates with the market - it's only "realized" when you sell.
On the Positions tab, you'll see what percentage of your total capital this position represents. In our example, the AAPL position is using about 27% of our $100,000 account - important information for risk management.
Note that your performance percentage doesn't change just because you got assigned. You haven't collected any new premium - the assignment is just a conversion of cash to stock. Your performance will increase when you sell covered calls and collect more premium.
Now that we own 100 shares of AAPL, we're ready for the next phase of the wheel strategy: selling covered calls against our position. In Part 3 of this series, we'll cover:
The wheel strategy is called "continuous" because you keep cycling between selling puts (to acquire shares at prices you like) and selling calls (to generate income and potentially exit at prices you're happy with). MyATMM tracks every step of this journey.
Options trading involves risk and is not suitable for all investors. When you sell cash-secured puts, you're obligated to buy shares at the strike price if assigned - make sure you're comfortable owning the underlying stock. Past performance does not guarantee future results. This content is for educational purposes only and should not be considered financial advice. Always consult with a qualified financial advisor before making investment decisions.
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