I just got assigned — what should I do next?

Getting assigned means you now own 100 shares of stock per contract — and your next move is to start selling covered calls against those shares immediately. Don't panic, don't sell the stock in frustration. You're exactly where the wheel strategy is supposed to take you.

Let's say you were selling cash-secured puts on AAPL at a $170 strike, collected $2.50 in premium, and got assigned when the stock dropped to $163. Your effective cost basis isn't $170 — it's $167.50 after accounting for that premium. That detail matters a lot. Write it down. Your actual breakeven is lower than the strike price you got assigned at, and that gap is your cushion.

First Thing: Calculate Your Real Cost Basis

Before you do anything else, grab a napkin and do this math. Take your assignment price (the strike), subtract every dollar of premium you've collected on this position — from the original put and any rolls you did along the way. That's your true cost basis. If you sold the $170 put for $2.50 and then rolled it once for another $1.20, your real basis is $166.30. That's the number you need to beat to be profitable on this trade, not $170.

This matters because a lot of traders freak out when they see a red position on their screen. Your broker shows your cost basis as $170 (the assignment price), but your P&L is actually better than that display suggests. Know your real number.

Now Sell a Covered Call

This is the whole point of getting assigned. You own 100 shares, so now you can sell a covered call and collect more premium while you wait for the stock to recover — or just keep generating income if it stays flat.

The question most people ask here is which strike to pick. Here's how I think about it: sell the call at or slightly above your real cost basis. Using the AAPL example with a $166.30 basis, I'd look at the $167 or $168 strike in the 30-45 DTE range. You want to collect enough premium to matter while giving yourself a realistic shot at getting called away at a small profit.

If AAPL is at $163 and you sell the $168 call for $2.80, here's what happens in the best case scenario: AAPL climbs back above $168, you get called away, and your total outcome is $168 (sale price) minus $166.30 (basis) plus $2.80 (call premium) = roughly $4.50 profit per share. Not bad for a trade that looked scary when you got assigned.

What If the Stock Keeps Dropping?

This is the real question, and I want to be honest with you: assignment risk is real, and the wheel doesn't work on every stock. If AAPL drops from $163 to $145, you're sitting on a bigger unrealized loss, and the covered calls you're selling won't fully cover it in the short term.

This is where your original stock selection matters more than anything else. If you got assigned on a stock you're genuinely comfortable holding — a company with solid fundamentals you'd own anyway — then keep selling calls and collecting premium. The wheel becomes a waiting game. If you got assigned on something you picked purely for high premium (a meme stock, a volatile biotech, a pre-earnings play), that's a different situation and you need to honestly assess whether you want to keep digging in.

I'd keep selling covered calls as long as the premium is worth it and the company thesis hasn't changed. For a stock like AAPL or MSFT, I'm comfortable holding and wheeling for months if needed. For a speculative name? I'd probably take the loss and redeploy capital into something I'm more confident about.

Don't Sell the Stock Out of Frustration

This is the most common mistake I see with new wheel traders. They get assigned, watch the stock drift lower for two weeks, and sell the shares at a loss just to "stop the bleeding." Then the stock recovers the week after. You've now locked in a loss AND missed the recovery.

If you've done the work on your stock selection and you're assigned on something you'd actually want to own, trust the process. Sell the covered call, collect the premium, and let time work for you. The covered call premium you collect each month is real money that keeps lowering your cost basis.

The Practical Takeaway

Right now, today, do three things: calculate your actual cost basis (strike minus all premium collected), pull up the options chain for your assigned stock, and sell a covered call in the 30-45 DTE window at or slightly above that real cost basis. Aim for a strike where you'd be happy getting called away — meaning you'd walk away with a small profit or at worst break even. Then set a reminder to manage that call at 50% profit or 21 DTE, whichever comes first. Assignment isn't a failure. It's just the next phase of the trade.