The decision Archer can't make for you
There's a question Archer gets asked more than any other, usually by people who are new to the platform and eager to get started: Which stocks should I trade?
It's a reasonable question. Archer analyzes options chains, calculates strike prices, tracks earnings windows, monitors positions in real time, and tells you exactly when to open and close trades. Surely it can also tell you which stocks to put in your universe.
It can't. More precisely — it won't.
This isn't a limitation of the platform. It's a deliberate design decision, and understanding why matters more than any specific stock recommendation ever could.
Why stock selection is your job
The wheel strategy rests on one foundational assumption: if you get assigned, you're okay owning the stock.
Assignment isn't a failure state — it's an outcome you agreed to when you chose your strike price. The put you sold was a contract that said: "I'm willing to buy 100 shares of this company at this price." If the stock drops below that price, the contract gets executed. You own the stock.
What happens next depends entirely on whether you actually wanted to own it.
If you chose the stock because Archer told you it had good premium characteristics — high implied volatility, liquid options chain, favorable DTE structure — but you don't actually have any view on the underlying business, you now own shares of a company you're ambivalent about, potentially at a loss, with no conviction about whether it recovers.
That's a difficult position to manage systematically. It leads to panic decisions: closing covered calls too early because you're anxious about price movements, rolling puts into worse positions trying to avoid assignment on a stock you never wanted to own, selling at the wrong time because you have no framework for how long to hold.
Archer is designed to eliminate anxiety from systematic trading. But it can only do that if the underlying conviction is yours.
What makes a stock wheel-worthy
Not every stock belongs in a wheel strategy. Here's how to think about which ones do.
- You understand what the company does. Not at an analyst level — you don't need to model earnings or understand supply chains. But you should have a basic sense of the business: how it makes money, what it sells, who buys from it. This matters because it gives you a foundation for thinking about whether a price decline is temporary or structural.
- You'd be comfortable holding 100 shares for 6–12 months if assigned. This is the real test. Not "would I buy this stock today" — that's a different question. But if you were assigned tomorrow and the stock went sideways for six months while you sold covered calls, would that feel acceptable? Or would it feel like a trap?
- The company isn't going away. Wheel strategy assignment turns you into a temporary shareholder. You don't need to be bullish on the stock in the "this is going to 10x" sense. You just need reasonable confidence that the company exists and functions in twelve months. For most large, established businesses, this is a low bar. For early-stage, money-losing, speculative names, it's a higher bar than most traders apply.
- It has a liquid options market. Archer handles this check, but it's worth understanding why it matters. Illiquid options have wide bid/ask spreads — the difference between what buyers will pay and what sellers will accept. Wide spreads mean you pay a significant tax on every trade. A stock with a liquid options market lets Archer execute closer to fair value.
The founder's universe — a real example
When the person who built Archer thinks about his own trading universe, it's a mix of companies he either uses, works in the industry of, or has watched long enough to have a genuine view on. AMZN because he uses AWS and has watched the business compound for years. AAPL because it's in his pocket and on his desk and its optionality is not going away. RDDT because he uses it daily and believes in its long-term monetization trajectory. RKLB because he has conviction that commercial space is a generational opportunity and has done the work to be comfortable with the volatility.
None of those are tips. They're the output of a simple filter: these are businesses I understand well enough that I'm not going to panic when they have a bad quarter.
That filter is different for every person. A healthcare professional might trade JNJ and UNH and ABT with genuine conviction that most people lack. A retail executive might have a different read on COST or CMG than a pure financial analysis suggests. A software engineer at a cloud company has a different view of MSFT or AMZN than a trader working from a data terminal.
The HTB framework — would you hold the bag?
Archer uses what it calls an HTB score — Hold the Bag — as a way of thinking systematically about assignment risk. It's a question: if you bought this stock today and it went sideways for a year, how painful would that be?
The inputs are: how has this stock historically recovered from significant drawdowns? How durable is the underlying business model? How strong is the balance sheet? And — this is the one most frameworks ignore — how would you emotionally handle holding it?
That last factor matters more than most quantitative models suggest. A stock with excellent fundamentals and a 30% drawdown will test your discipline in ways that a back-test can't capture. Your ability to keep selling covered calls systematically while underwater on the shares is what determines whether the wheel cycle eventually resolves profitably.
Stocks that score poorly on HTB aren't necessarily bad investments. They're just bad wheel candidates, because they make it too easy to break discipline at exactly the wrong moment.
A practical starting point
If you're building your first wheel universe, here's a framework that works:
Start with 5–8 stocks, not 20. Concentration lets you pay attention. Diversification is a risk management tool, but in the early stages it's also a way to avoid developing real conviction on any single name.
Pick at least two that you'd consider genuinely conservative — large, established, boring businesses that you're comfortable with at a deep level. These are your anchors. They may not generate exciting premiums, but they'll behave predictably and let you build confidence in the systematic execution.
Add two or three with higher conviction and higher volatility tolerance. These are names where you've done real work and you genuinely believe in the underlying business, enough that assignment at a 15% discount to today's price feels like an opportunity rather than a setback.
Revisit the list quarterly, not weekly. The universe should evolve with your conviction, not with short-term price movements.
What Archer does once you've picked
Once your universe is set, Archer scans it continuously. It watches for valid options windows — the right combination of DTE, premium, strike, and earnings clearance — and surfaces recommendations when conditions align. It tracks your open positions, calculates dynamic exit targets, and tells you when to close.
The screening, monitoring, and systematic execution: that's Archer's job.
The underlying conviction: that's yours.