Income Alerts Newsletter for 01/12/2017

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 1.02% return, which annualizes at a rate of 16.17%.

Chart for QQQ

The DIA options at strike $199.50 for February 3 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for DIA

The SPY options at strike $227.50 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 PCLN at strike $1537.50 using 300 shares is offering an income potential of $3,990. In February, a strike 1540.00 covered call offers $12,660 and in March, a strike 1540.00 covered call offers $18,120 in premium.

The annualized return by writing covered calls in January is 31.88%, in February is 27.13% and in March is 22.64%.

Chart for PCLN

A February covered call on BABA at strike $155.00 using 300 shares is offering an income potential of $96.

The annualized return by writing covered calls in February is 3.27%.

Chart for BABA


Energy Focus: Income Opportunities

A January covered call on OXY at strike $97.50 using 300 shares is offering an income potential of $600.

The annualized return by writing covered calls in January is 26.30%.

Chart for OXY

A May covered call on SLB at strike $100.00 using 300 shares is offering an income potential of $123.

The annualized return by writing covered calls in May is 1.37%.

Chart for SLB


Healthcare Focus: Income Opportunities

A January covered call on HCA at strike $81.50 using 300 shares is offering an income potential of $150. In March, a strike 87.50 covered call offers $225 in premium.

The annualized return by writing covered calls in January is 25.73% and in March is 5.36%.

Chart for HCA

A January covered call on ESRX at strike $72.50 using 300 shares is offering an income potential of $228. In February, a strike 72.50 covered call offers $678 and in March, a strike 72.50 covered call offers $858 in premium.

The annualized return by writing covered calls in January is 38.89%, in February is 31.09% and in March is 22.85%.

Chart for ESRX


Consumer Staples Focus: Income Opportunities

A January covered call on WBA at strike $84.50 using 300 shares is offering an income potential of $279. In February, a strike 85.00 covered call offers $540 and in April, a strike 85.00 covered call offers $1,020 in premium.

The annualized return by writing covered calls in January is 40.65%, in February is 20.92% and in April is 15.16%.

Chart for WBA


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 4.72% and in March is 2.24%.

Chart for CBS

A January covered call on CMCSA at strike $72.00 using 300 shares is offering an income potential of $189. In February, a strike 72.50 covered call offers $438 and in April, a strike 72.50 covered call offers $735 in premium.

The annualized return by writing covered calls in January is 29.50%, in February is 19.96% and in April is 12.78%.

Chart for CMCSA


Financials Focus: Income Opportunities

A January covered call on JPM at strike $87.50 using 300 shares is offering an income potential of $351. In February, a strike 87.50 covered call offers $642 and in March, a strike 87.50 covered call offers $855 in premium.

The annualized return by writing covered calls in January is 49.71%, in February is 24.20% and in March is 18.71%.

Chart for JPM

A January covered call on AXP at strike $77.00 using 300 shares is offering an income potential of $480. In February, a strike 77.50 covered call offers $621 and in April, a strike 77.50 covered call offers $990 in premium.

The annualized return by writing covered calls in January is 77.55%, in February is 26.57% and in April is 16.20%.

Chart for AXP


Industrials Focus: Income Opportunities

A May covered call on UNP at strike $130.00 using 300 shares is offering an income potential of $84.

The annualized return by writing covered calls in May is 0.77%.

Chart for UNP

A January covered call on UTX at strike $116.00 using 300 shares is offering an income potential of $72. In May, a strike 130.00 covered call offers $78 in premium.

The annualized return by writing covered calls in January is 8.79% and in May is 0.67%.

Chart for UTX


Materials Focus: Income Opportunities

A May covered call on PPG at strike $105.00 using 300 shares is offering an income potential of $375.

The annualized return by writing covered calls in May is 3.74%.

Chart for PPG

A May covered call on HUN at strike $23.00 using 300 shares is offering an income potential of $120.

The annualized return by writing covered calls in May is 5.84%.

Chart for HUN


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 1.21%.

Chart for D

A January covered call on DUK at strike $77.50 using 300 shares is offering an income potential of $150. In February, a strike 77.50 covered call offers $390 and in April, a strike 77.50 covered call offers $630 in premium.

The annualized return by writing covered calls in January is 23.83%, in February is 16.47% and in April is 10.12%.

Chart for DUK


Telecommunications Focus: Income Opportunities

A January covered call on VOD at strike $39.00 using 300 shares is offering an income potential of $96. In February, a strike 27.00 covered call offers $165 and in April, a strike 27.00 covered call offers $291 in premium.

The annualized return by writing covered calls in January is 44.58%, in February is 20.34% and in April is 13.72%.

Chart for VOD

A January covered call on SBAC at strike $105.00 using 300 shares is offering an income potential of $300. In February, a strike 105.00 covered call offers $795 and in March, a strike 105.00 covered call offers $1,200 in premium.

The annualized return by writing covered calls in January is 35.19%, in February is 24.94% and in March is 21.97%.

Chart for SBAC

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

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