Glossary
Cost basis
What you actually paid per share. The reference every protection, income or repair decision has to be measured against.
What it is
Your cost basis is the price you paid per share, adjusted down by any premium you have already collected against those shares. It is the line between a position that has something to defend and one that has a hole to climb out of.
Why it changes the answer
The same put, at the same price, on the same stock, is sensible insurance when the strike sits above your basis and a paid-for guarantee of your loss when it sits below it. The same covered call is income when the strike is above your basis and a realised loss waiting to happen when it is below. No structure can be judged without it.
Recovery price
When you are down, the useful number is the share price at which the whole position (shares at basis plus any new legs) is back to even. Doing nothing recovers at your basis. A structure that recovers lower is doing real work; a protective put always recovers higher, because you now have to earn the premium back too. The Position Doctor prints this on every card.
Where you will see it
- Position DoctorYou own the shares and the stock is down. The Doctor prices a protective put, covered calls, a collar and a 1×2 repair ratio off the live chain and measures each one by the price at which you are back to even against what you actually paid — and says plainly when buying a put would only lock in the loss.
- Covered CallsCalls worth selling against shares you already own — the exit leg of the Wheel, ranked by premium richness, the annualized return the premium alone pays, and a calm technical setup.
- Wheel TrackerRun the wheel end-to-end: cash-secured put suggestions, assignment tracking, and covered-call income all in one place.