Options trading is often viewed as high-risk, but when applied to a stock you actually want to own, it becomes a powerful income generator. Over the last three months, I’ve been running the Wheel Strategy on IREN (Iris Energy).
By systematically selling puts, taking assignment, and then selling covered calls, I turned a volatile crypto-mining stock into a consistent cash flow machine. Here is the step-by-step breakdown of the trade.
Phase 1: Selling "Insurance" (The Cash-Secured Put)
The Wheel begins by selling Cash-Secured Puts. The goal here is simple: get paid to wait for a better entry price on the stock.
From November through December 2025, I sold multiple put contracts, "rolling" them forward to collect more premium while IREN’s price fluctuated.
Nov 03 – Dec 22: Through a series of six trades and "rolls," I collected a total of $611.00 in put premiums.
The Strategy: Even though I didn't own the stock yet, I was already generating a "dividend" from the volatility.
Phase 2: The Assignment
On January 2nd, 2026, the stock price dipped below my strike, and I was assigned 100 shares of IREN at $43.50.
Initial Outlay: $4,350.00
Effective Entry: Because I had already collected $611 in put premiums, my "real" cost for those shares was already down to $37.39 per share ($3,739 total).
Phase 3: Collecting Rent (The Covered Call)
Once I owned the shares, the strategy flipped. I started selling Covered Calls—essentially charging other traders for the right to buy my shares if the price skyrocketed.
Early Jan: I sold the $45 Call and rolled it twice for a total of $437.00 in call premiums.
The Final Move: I sold the $47 Call expiring 1/30. This setup allows me to profit from both the option premium and the $3.50 per share increase in the stock's value ($47.00 sale price - $43.50 buy price).
The Final Scorecard
If IREN remains above $47.00 through January 30th, the shares will be called away, and the trade cycle completes. Here is the total profit breakdown:
| Component | Amount |
| Capital Gains (Sale at $47 vs $43.50 Buy) | +$350.00 |
| Put Premiums (Nov - Dec) | +$611.00 |
| Call Premiums (Jan) | +$437.00 |
| Total Realized Profit | $1,398.00* |
Why This Worked
Cost Basis Reduction: I didn't just buy IREN at $43.50; I used options to lower my "break-even" point by over $10 per share.
Patience Pays: By "rolling" positions rather than closing them at a loss, I stayed in the game until the trade turned profitable.
High Volatility (IV): Crypto-related stocks like IREN often offer higher premiums, making the Wheel Strategy particularly lucrative for disciplined traders.
What’s Next? Once these shares are called away on Jan 30th, I'll have my $4,350 back plus nearly $1,400 in profit. The best part? I can start the cycle all over again by selling a new put!
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