Income Alerts Newsletter for 02/06/2017

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 $126.00 for March 3 2017 are offering a 0.97% return, which annualizes at a rate of 14.19%.

Chart for QQQ

The DIA options at strike $201.00 for March 3 2017 are offering a 0.63% return, which annualizes at a rate of 9.16%.

Chart for DIA


Technology Focus: Income Opportunities

A February covered call on BABA at strike $101.00 using 300 shares is offering an income potential of $393. In March, a strike 105.00 covered call offers $384 and in April, a strike 105.00 covered call offers $720 in premium.

The annualized return by writing covered calls in February is 40.22%, in March is 11.78% and in April is 11.92%.

Chart for BABA

A February covered call on FB at strike $131.00 using 300 shares is offering an income potential of $612. In March, a strike 135.00 covered call offers $630 and in April, a strike 135.00 covered call offers $1,035 in premium.

The annualized return by writing covered calls in February is 48.12%, in March is 14.87% and in April is 13.17%.

Chart for FB


Energy Focus: Income Opportunities

A February covered call on OXY at strike $69.50 using 300 shares is offering an income potential of $336. In March, a strike 70.00 covered call offers $423 and in May, a strike 70.00 covered call offers $699 in premium.

The annualized return by writing covered calls in February is 40.04%, in March is 17.66% and in May is 12.00%.

Chart for OXY

A February covered call on HAL at strike $57.00 using 300 shares is offering an income potential of $243. In March, a strike 57.50 covered call offers $420 and in April, a strike 57.50 covered call offers $657 in premium.

The annualized return by writing covered calls in February is 44.18%, in March is 23.15% and in April is 19.60%.

Chart for HAL


Healthcare Focus: Income Opportunities

An April covered call on PFE at strike $33.00 using 300 shares is offering an income potential of $147.

The annualized return by writing covered calls in April is 7.55%.

Chart for PFE

A February covered call on HCA at strike $84.00 using 300 shares is offering an income potential of $345. In March, a strike 85.00 covered call offers $555 and in June, a strike 87.50 covered call offers $960 in premium.

The annualized return by writing covered calls in February is 42.32%, in March is 20.60% and in June is 11.06%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

A February covered call on KO at strike $42.00 using 300 shares is offering an income potential of $90. In March, a strike 42.00 covered call offers $144 and in April, a strike 42.00 covered call offers $207 in premium.

The annualized return by writing covered calls in February is 22.13%, in March is 10.67% and in April is 8.22%.

Chart for KO

A February covered call on PEP at strike $106.00 using 300 shares is offering an income potential of $228. In April, a strike 110.00 covered call offers $168 in premium.

The annualized return by writing covered calls in February is 22.15% and in April is 2.61%.

Chart for PEP


Consumer Discretionary Focus: Income Opportunities

A February covered call on DG at strike $73.50 using 300 shares is offering an income potential of $330. In March, a strike 75.00 covered call offers $630 and in May, a strike 75.00 covered call offers $990 in premium.

The annualized return by writing covered calls in February is 37.16%, in March is 25.09% and in May is 16.27%.

Chart for DG

A February covered call on GM at strike $36.50 using 300 shares is offering an income potential of $225. In March, a strike 37.00 covered call offers $261 and in June, a strike 37.00 covered call offers $528 in premium.

The annualized return by writing covered calls in February is 51.29%, in March is 20.83% and in June is 13.87%.

Chart for GM


Financials Focus: Income Opportunities

A February covered call on MS at strike $44.50 using 300 shares is offering an income potential of $243. In March, a strike 45.00 covered call offers $381 and in April, a strike 45.00 covered call offers $561 in premium.

The annualized return by writing covered calls in February is 56.48%, in March is 26.85% and in April is 21.38%.

Chart for MS

A February covered call on WFC at strike $57.50 using 300 shares is offering an income potential of $207. In March, a strike 57.50 covered call offers $426 and in April, a strike 57.50 covered call offers $627 in premium.

The annualized return by writing covered calls in February is 29.67%, in March is 21.58% and in April is 17.72%.

Chart for WFC


Industrials Focus: Income Opportunities

A February covered call on UTX at strike $110.00 using 300 shares is offering an income potential of $237. In March, a strike 110.00 covered call offers $474 and in May, a strike 110.00 covered call offers $915 in premium.

The annualized return by writing covered calls in February is 22.07%, in March is 13.34% and in May is 10.14%.

Chart for UTX

A February covered call on BA at strike $162.50 using 300 shares is offering an income potential of $459. In March, a strike 165.00 covered call offers $648 and in April, a strike 165.00 covered call offers $1,065 in premium.

The annualized return by writing covered calls in February is 28.93%, in March is 12.30% and in April is 10.88%.

Chart for BA


Materials Focus: Income Opportunities

A February covered call on MON at strike $109.00 using 300 shares is offering an income potential of $156. In March, a strike 110.00 covered call offers $231 and in April, a strike 110.00 covered call offers $495 in premium.

The annualized return by writing covered calls in February is 11.68%, in March is 6.05% and in April is 7.20%.

Chart for MON

A March covered call on PPG at strike $105.00 using 300 shares is offering an income potential of $180. In May, a strike 105.00 covered call offers $615 in premium.

The annualized return by writing covered calls in March is 5.46% and in May is 7.35%.

Chart for PPG


Utilities Focus: Income Opportunities

A May covered call on CNP at strike $27.00 using 300 shares is offering an income potential of $165.

The annualized return by writing covered calls in May is 7.57%.

Chart for CNP

A March covered call on DUK at strike $80.00 using 300 shares is offering an income potential of $120. In April, a strike 80.00 covered call offers $255 in premium.

The annualized return by writing covered calls in March is 4.72% and in April is 5.39%.

Chart for DUK


Telecommunications Focus: Income Opportunities

A February covered call on T at strike $41.50 using 300 shares is offering an income potential of $96. In March, a strike 42.00 covered call offers $144 and in April, a strike 42.00 covered call offers $207 in premium.

The annualized return by writing covered calls in February is 19.02%, in March is 9.99% and in April is 7.96%.

Chart for T

A February covered call on CTL at strike $26.00 using 300 shares is offering an income potential of $90. In March, a strike 26.00 covered call offers $120 and in April, a strike 26.00 covered call offers $180 in premium.

The annualized return by writing covered calls in February is 36.33%, in March is 14.59% and in April is 11.76%.

Chart for CTL

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

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