Why Your Broker’s Reports Are Misleading: The True Economics of the Wheel

1. True Break-even (TBE): Your Armor During the Put Phase

When you sell a Cash Secured Put, your broker shows a break-even point only for that specific contract. But if you’ve rolled that position or collected premiums for weeks before being assigned, your actual risk is much lower.

True Break-even (TBE) is the share price at which you truly "break even," accounting for all premiums collected within the current cycle.

$$TBE = \text{Strike Price} - \frac{\sum \text{Premiums in current cycle}}{\text{Shares Count}}$$

The Wheelytics Edge: While your broker might show you "losing" on a trade, TBE proves that your accumulated premiums keep you in the green even if the stock price dips below your strike.

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2. Adjusted Cost Basis (ACB): The Real Price of Ownership

The moment an Assignment occurs, the "Wheel" shifts into the ownership phase. Now, your goal isn't just selling calls—it's driving your cost basis down as close to zero as possible.

Adjusted Cost Basis (ACB) factors in the purchase price minus all the premiums you’ve earned from Puts (before assignment) and Covered Calls (after assignment).

$$\text{Cycle ACB} = \frac{(\text{Purchase Price} \times \text{Shares}) - \sum \text{All Premiums in Cycle}}{\text{Shares Count}}$$

Every Covered Call that expires worthless "chips away" at your ACB, lowering your financial risk every single week.

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3. Underlying Lifetime ACB: Your "Safety Moat"

This is the ultimate metric for the long-term "Wheeler." While a standard ACB is tied to a specific cycle, the Underlying Lifetime ACB tracks your entire history with a specific ticker. It accounts for every realized profit and loss since you started using Wheelytics.

Depending on your current position, this is calculated in two ways:

A. If you hold shares (Ownership Phase)

It shows the "all-time" net cost of your current position.

$$\text{Lifetime ACB} = \frac{\text{Current Investment} - \text{Total Realized P\&L for Ticker}}{\text{Current Shares Held}}$$

B. If you only have Puts (Cash Secured Phase)

This represents your Potential Lifetime Entry Price. It shows the price at which you would effectively own the stock if assigned today, considering your entire historical profit "cushion."

$$\text{Lifetime ACB (Puts)} = \text{Current Strike} - \frac{\text{Total Realized P\&L for Ticker}}{\text{Put Contract Qty} \times 100}$$

Why does this matter?

Even if your current Put looks risky, your Lifetime ACB might show that after two years of successful trading, your "true" entry point is 20% below the current market price. This is your psychological buffer—it proves that your consistent strategy has created a massive margin of safety.

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Summary: Which Metric When?

Metric	When to watch it?	What does it show?
TBE	During the Put phase	Your effective "entry price" if assigned.
Cycle ACB	While holding shares	The efficiency of your current "Wheel."
Lifetime ACB	Always	Your global success with a specific asset.

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Stop Trading Blind

Wheelytics automatically recalculates these figures with every import, turning the chaos of CSV files into a clear, actionable strategy. By understanding your True Break-even and Lifetime ACB, you gain the psychological edge needed to trade the Wheel with confidence.