Income Alerts Newsletter for 01/11/2017

Safety First

With capital preservation as our most important priority, we begin as always with a focus on index covered calls, which mitigate company specific risk.

Writing covered calls on ETFs, such as QQQs, is attractive to conservative investors who may not have the time to monitor a selection of companies on a watchlist and wish to avoid risks associated with trading specific companies, such as earnings surprises.

The QQQ options at strike $123.00 for February 3 2017 are offering a 1.21% return, which annualizes at a rate of 18.33%.

Chart for QQQ

The DIA options at strike $198.50 for February 3 2017 are offering a 0.97% return, which annualizes at a rate of 14.71%.

Chart for DIA

The SPY options at strike $226.50 for February 3 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for SPY


Technology Focus: Income Opportunities

A January covered call on FB at strike $125.00 using 300 shares is offering an income potential of $459. In February, a strike 125.00 covered call offers $1,335 and in March, a strike 125.00 covered call offers $1,635 in premium.

The annualized return by writing covered calls in January is 41.34%, in February is 34.74% and in March is 24.97%.

Chart for FB

A January covered call on PCLN at strike $1587.50 using 300 shares is offering an income potential of $465. In February, a strike 1555.00 covered call offers $10,560 and in March, a strike 1560.00 covered call offers $10,320 in premium.

The annualized return by writing covered calls in January is 3.69%, in February is 22.54% and in March is 12.68%.

Chart for PCLN


Energy Focus: Income Opportunities

A May covered call on SLB at strike $87.50 using 300 shares is offering an income potential of $1,020.

The annualized return by writing covered calls in May is 11.85%.

Chart for SLB

A January covered call on APC at strike $70.00 using 300 shares is offering an income potential of $321. In February, a strike 70.00 covered call offers $834 and in May, a strike 70.00 covered call offers $1,545 in premium.

The annualized return by writing covered calls in January is 51.82%, in February is 38.95% and in May is 22.44%.

Chart for APC


Healthcare Focus: Income Opportunities

A January covered call on GILD at strike $75.50 using 300 shares is offering an income potential of $405. In February, a strike 77.50 covered call offers $564 and in March, a strike 77.50 covered call offers $711 in premium.

The annualized return by writing covered calls in January is 60.81%, in February is 24.06% and in March is 17.77%.

Chart for GILD

A January covered call on HCA at strike $81.50 using 300 shares is offering an income potential of $150. In March, a strike 82.50 covered call offers $615 in premium.

The annualized return by writing covered calls in January is 23.47% and in March is 14.87%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

A January covered call on CVS at strike $83.00 using 300 shares is offering an income potential of $198. In February, a strike 85.00 covered call offers $336 and in March, a strike 85.00 covered call offers $492 in premium.

The annualized return by writing covered calls in January is 26.70%, in February is 12.85% and in March is 11.03%.

Chart for CVS


Consumer Discretionary Focus: Income Opportunities

A February covered call on CBS at strike $70.00 using 300 shares is offering an income potential of $90. In March, a strike 75.00 covered call offers $75 in premium.

The annualized return by writing covered calls in February is 4.62% and in March is 2.21%.

Chart for CBS

A January covered call on CMCSA at strike $71.00 using 300 shares is offering an income potential of $342. In February, a strike 72.50 covered call offers $402 and in April, a strike 72.50 covered call offers $681 in premium.

The annualized return by writing covered calls in January is 30.18%, in February is 18.02% and in April is 11.83%.

Chart for CMCSA


Financials Focus: Income Opportunities

A January covered call on GS at strike $245.00 using 300 shares is offering an income potential of $1,155. In February, a strike 245.00 covered call offers $2,145 and in April, a strike 245.00 covered call offers $3,540 in premium.

The annualized return by writing covered calls in January is 53.51%, in February is 28.42% and in April is 18.30%.

Chart for GS

A March covered call on MS at strike $48.00 using 300 shares is offering an income potential of $120.

The annualized return by writing covered calls in March is 5.19%.

Chart for MS


Industrials Focus: Income Opportunities

A January covered call on UNP at strike $104.00 using 300 shares is offering an income potential of $588. In February, a strike 105.00 covered call offers $774 and in May, a strike 105.00 covered call offers $1,395 in premium.

The annualized return by writing covered calls in January is 64.10%, in February is 23.95% and in May is 13.22%.

Chart for UNP

A January covered call on UTX at strike $113.00 using 300 shares is offering an income potential of $162. In May, a strike 125.00 covered call offers $153 in premium.

The annualized return by writing covered calls in January is 17.80% and in May is 1.30%.

Chart for UTX


Materials Focus: Income Opportunities

A May covered call on PPG at strike $100.00 using 300 shares is offering an income potential of $810.

The annualized return by writing covered calls in May is 8.15%.

Chart for PPG

A January covered call on DOW at strike $58.00 using 300 shares is offering an income potential of $153. In February, a strike 60.00 covered call offers $198 and in March, a strike 60.00 covered call offers $321 in premium.

The annualized return by writing covered calls in January is 29.61%, in February is 10.83% and in March is 10.30%.

Chart for DOW


Utilities Focus: Income Opportunities

An April covered call on D at strike $85.00 using 300 shares is offering an income potential of $75.

The annualized return by writing covered calls in April is 1.20%.

Chart for D

A May covered call on ED at strike $77.50 using 300 shares is offering an income potential of $420.

The annualized return by writing covered calls in May is 5.56%.

Chart for ED


Telecommunications Focus: Income Opportunities

A January covered call on VOD at strike $26.50 using 300 shares is offering an income potential of $81. In February, a strike 27.00 covered call offers $120 and in April, a strike 27.00 covered call offers $240 in premium.

The annualized return by writing covered calls in January is 34.78%, in February is 14.61% and in April is 11.35%.

Chart for VOD

A February covered call on CTL at strike $26.00 using 300 shares is offering an income potential of $150. In April, a strike 26.00 covered call offers $240 in premium.

The annualized return by writing covered calls in February is 18.95% and in April is 11.73%.

Chart for CTL

* Prices quoted were as of time of writing and may not be current.

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