March was a transitional month. I closed some positions early, shifted from cash-secured puts back into shares, and collected the quarterly dividend. I also learned (again) that timing the market perfectly is impossible — but the wheel keeps working anyway.
The Numbers
The Trades
Closing SCHD Puts Early
I had 525 SCHD puts at the $29 strike. SCHD had run up to about $31.38, cutting my put premium in half. I made a decision: close for 50% profit rather than wait for expiration.
The 50% rule worked here. I captured most of the premium with less time risk. But here's where it gets interesting...
Buying Back Into SCHD
After closing the puts, I bought shares at $31.40 and immediately sold covered calls. SCHD had already run from $29 to $31+ while I was holding puts. Did I "miss" some upside? Yes. But opportunity cost isn't the same as actual loss.
The Dividend
Timing mattered here. The SCHD ex-dividend date was March 26. My covered calls expired March 20 — before ex-div. This was intentional. I wanted to:
- Keep the shares through ex-div
- Collect the dividend (~$13,100)
- Avoid early assignment risk
It worked. Calls expired worthless, I kept the premium AND the dividend.
The Lesson
While I was sitting in cash-secured puts at $29, SCHD ran to $31+. That's roughly $79,000 in "missed" appreciation on 52,500 shares. It stings to think about.
But here's the thing: I still collected $7,875 in put premium. I still got into shares (at a higher price, yes). I still collected $14,550 in call premium. And I still collected $13,100 in dividends.
The wheel doesn't promise perfect timing. It promises consistent income. March delivered.
Looking Ahead
April will be another off-month for dividends. I'll be selling covered calls on SCHD and either holding VTI shares or selling puts depending on where the market goes. The goal is steady income, not home runs.
Net savings for March: $20,929.
— Russell