Does the wheel strategy work in a bear market?

The wheel strategy performs best in sideways to slightly bullish markets. In a prolonged bear market, you'll be assigned more often. However, assigned stocks at good prices can recover when the market turns. Key is position sizing and only wheel stocks you'd want to own long-term.

How much money do I need to start the wheel strategy?

You need enough capital to cover the strike price of 100 shares. For a $50 stock, you'd need $5,000 in your account to sell one cash secured put. Many brokers allow portfolio margin which can reduce this requirement significantly.

What happens if I'm assigned on a wheel trade?

Being assigned means you now own the stock at your strike price. This is not a loss — it's a transition. You can then sell covered calls against the stock to generate additional income while waiting for it to recover or reach your target exit price.

Should I check my wheel positions every day?

Checking daily is unnecessary and can cause anxiety-driven decisions. Weekly reviews are sufficient. Set alert prices for when you need to take action (e.g., stock drops 20%, or premium doubles in value), and otherwise let the position breathe.

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Why Every Options Trader Needs a Trading Journal (And How to Start One)

Trading Mindset · Published 2026-06-25

Here's a question I ask every struggling options trader I meet: show me your trading journal. You know what most of them say? "I don't keep one."

Then I ask them: how do you expect to improve if you don't track what you're doing? How do you know which strategies work? How do you identify your blind spots? How do you learn from your mistakes if you can't even remember making them?

Crickets.

The trading journal is the single most underrated tool in an options trader's arsenal. Not because it makes you smarter — it won't. But because it makes your stupidity visible. And once you can see your mistakes clearly, you can actually do something about them.

What a Trading Journal Actually Does

Most people think a trading journal is for tracking P&L. That's the baseline, but it's the least interesting thing about it. A proper trading journal is a decision log. It captures why you made each trade, not just what happened after.

This distinction matters enormously. Two traders can take the exact same trade — same stock, same strike, same expiration, same premium — and one makes money while the other loses. The difference is never in the trade itself. It's in the decision process. One trader had a reason for the trade that was based on analysis and fit their system. The other trader was bored, or emotional, or chasing a tip from a stranger on the internet.

Without a journal, you can't tell the difference. With a journal, you can start to see patterns. You'll notice that you make money when you wait for your setups, and lose money when you trade impulsively. You'll realize that certain market conditions just don't work for your strategy, even though you kept trying to force it. You'll catch yourself repeating the same mistakes over and over — and finally start doing something different.

The Minimum Viable Trading Journal

You don't need sophisticated software or fancy spreadsheets to start journaling. Here's the absolute minimum I recommend for every options trader:

Trade entry: Date, ticker, whether you bought or sold, call or put, strike, expiration, premium, number of contracts. Why you entered — and I mean the specific reason, not "it looked good." Was there a catalyst? Did it fit your system? What was your target?

Pre-trade checklist confirmation: Did you check IV rank? Did you verify the news calendar? Did you confirm the trend direction? This is where you catch yourself skipping steps.

Post-trade emotions: How did you feel entering this trade? Nervous? Confident? FOMO? This isn't woo-woo — emotions are data. If you're entering trades feeling anxious, you're probably sizing too big or don't have conviction. If you're feeling euphoric, you might be in a hot stock that's about to reverse.

Exit: Date, reason for exit (target hit, stop loss, time stop, assignment), P&L in dollars and percentage.

Reflection: What went well? What went poorly? What would you do differently?

That's it. Four sections per trade. It takes 2 minutes to fill out. And it will teach you more about your trading than any book or course ever could.

What Your Journal Will Teach You

After about 30-40 trades, your journal starts revealing things. Patterns emerge that you had no idea existed because you weren't looking at your data systematically.

Here are the patterns I've found in my own journal — and what to look for in yours:

Time-of-day patterns: I discovered I lose money on wheel trades entered after 2pm ET. My afternoon entries were impulsive — I'd been watching the market all day, got bored, and talked myself into a trade that wasn't actually in my system. Once I saw it in the journal, I just stopped trading after 2pm. My win rate improved immediately.

Earnings and catalyst patterns: I thought I was "playing it safe" by avoiding earnings plays. But my journal showed I was actually taking on more risk by holding positions into earnings without realizing it — I had several wheel trades that got assigned right before earnings because I hadn't checked the calendar. Now earnings is a mandatory checklist item.

Position sizing patterns: I noticed my biggest losses all had one thing in common: I was sizing up after wins, trying to "make it big." That's not a system — that's gambling. My journal showed I had a 34% win rate on oversized positions versus 71% on normal-sized ones. The bigger I traded, the worse I performed. Now I have a hard position sizing rule that my journal enforces.

Market condition patterns: My wheel strategy performs completely differently in low VIX versus high VIX environments. In calm markets, I'm better off selling puts closer to the money and collecting smaller premiums consistently. In volatile markets, I can be more aggressive with out-of-the-money strikes. Without the journal, I never would have seen this pattern — I just would have blamed the strategy for performing differently under different conditions.

The Five-Panel Review Method

Once a month, I do a formal journal review. I go through every trade from the previous month and categorize them into five panels:

Panel 1: Best trades. What made these great? Was it the setup? The entry timing? The conviction? Capture the specific factors so you can replicate them.

Panel 2: Worst trades. Same analysis — what specifically went wrong? Be ruthlessly honest. "The market moved against me" is not an analysis — it's an excuse. What was the actual error?

Panel 3: Trades that broke my rules. Did you take a trade that wasn't in your system? Did you skip a checklist item? Did you size differently than planned? These are the most important to analyze because rule violations are where blowups live.

Panel 4: Trades I over-analyzed. Sometimes we second-guess ourselves into paralysis. Did you miss good opportunities because you were too in your head? This is a different kind of problem than impulsive trading, but it costs money too.

Panel 5: Pattern observations. What themes emerged this month? Did a particular strategy consistently outperform? Did certain market conditions create more opportunities? What do you want to focus on next month?

This review takes about an hour. And it will do more for your trading development than any indicator, strategy, or signal service ever could.

Digital Tools vs. Paper

I use a simple spreadsheet — Google Sheets so it's accessible from anywhere. Columns for all the data points, color-coding for P&L (green for winners, red for losers), and a separate tab for my monthly review notes. This takes minutes to maintain and gives me everything I need.

Some traders swear by dedicated journaling software like Trade Analytics or Edgefolio. These can be powerful — they automate the data entry and generate statistics automatically. But they're also friction. If the tool is too cumbersome, you won't use it consistently. Better to use a simple system you'll actually maintain than a perfect system you'll abandon after two weeks.

Whatever you use, the key is consistency. Every trade, every time. No exceptions. Even when you're tired. Even when it's a "small" trade. Especially then. The patterns you're looking for hide in the small trades you think don't matter.

The Accountability Effect

Here's a benefit of journaling that nobody talks about: it changes how you trade before you even open the journal.

When you know you're writing down your reasoning, you think more carefully before entering. When you know you're reviewing your trades at month end, you're more honest with yourself about mistakes. When you know your journal is watching, you make fewer impulsive decisions.

This is the accountability effect. The act of recording forces intentionality. You're not just "trading" anymore — you're building a record of your decision-making that you have to stand behind.

I've had traders tell me they started journaling not because they wanted to improve, but because they felt like they "should." Within three months, every single one of them reported better trading discipline — not because the journal gave them new information, but because the act of recording made them more careful in the first place.

Start Today, Not Tomorrow

You don't need to be ready. You don't need a perfect system. You just need to start recording your trades.

Open a spreadsheet right now. Create these columns: Date, Ticker, Direction, Call/Put, Strike, Expiration, Premium, Contracts, Why I Entered, How I Felt, Exit Date, Exit Reason, P&L, Reflection.

That's nine columns. It takes five minutes to set up. Start filling it in with your next trade.

If you're looking at 200 past trades and feeling overwhelmed — don't. Start from today. You can't change the past, but you can start building a better future. The journal is how you do that.

Your trading journal is the only edge you'll ever need. Everything else is already in the market, already priced in, already competing against millions of other traders. Your edge is your consistency, your discipline, and your willingness to learn from your own experience.

The journal is how you capture that experience and turn it into something useful. Start today.