Income Alerts Newsletter for 02/24/2017

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 $130.50 for March 18 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for QQQ

The DIA options at strike $208.00 for March 18 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for DIA

The SPY options at strike $236.50 for March 18 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for SPY


Technology Focus: Income Opportunities

A March covered call on QCOM at strike $57.50 using 300 shares is offering an income potential of $234. In April, a strike 57.50 covered call offers $561 and in May, a strike 60.00 covered call offers $393 in premium.

The annualized return by writing covered calls in March is 21.96%, in April is 21.29% and in May is 9.96%.

Chart for QCOM

A March covered call on BABA at strike $103.00 using 300 shares is offering an income potential of $618. In April, a strike 105.00 covered call offers $822 and in May, a strike 105.00 covered call offers $1,275 in premium.

The annualized return by writing covered calls in March is 32.56%, in April is 17.29% and in May is 18.37%.

Chart for BABA


Healthcare Focus: Income Opportunities

A May covered call on ESRX at strike $82.50 using 300 shares is offering an income potential of $72.

The annualized return by writing covered calls in May is 1.46%.

Chart for ESRX

A March covered call on MCK at strike $190.00 using 300 shares is offering an income potential of $570. In May, a strike 210.00 covered call offers $330 in premium.

The annualized return by writing covered calls in March is 21.43% and in May is 3.19%.

Chart for MCK


Consumer Staples Focus: Income Opportunities

A March covered call on ADM at strike $45.50 using 300 shares is offering an income potential of $180. In April, a strike 46.00 covered call offers $270 and in June, a strike 48.00 covered call offers $261 in premium.

The annualized return by writing covered calls in March is 21.40%, in April is 12.82% and in June is 6.30%.

Chart for ADM

A March covered call on PEP at strike $110.00 using 300 shares is offering an income potential of $201. In April, a strike 110.00 covered call offers $468 and in June, a strike 110.00 covered call offers $762 in premium.

The annualized return by writing covered calls in March is 9.77%, in April is 9.09% and in June is 7.60%.

Chart for PEP


Consumer Discretionary Focus: Income Opportunities

A March covered call on GM at strike $37.50 using 300 shares is offering an income potential of $189. In April, a strike 38.00 covered call offers $261 and in June, a strike 38.00 covered call offers $441 in premium.

The annualized return by writing covered calls in March is 27.30%, in April is 15.05% and in June is 13.15%.

Chart for GM

A March covered call on AMZN at strike $975.00 using 300 shares is offering an income potential of $81.

The annualized return by writing covered calls in March is 0.53%.

Chart for AMZN


Financials Focus: Income Opportunities

A March covered call on MET at strike $54.00 using 300 shares is offering an income potential of $228. In April, a strike 55.00 covered call offers $306 and in May, a strike 55.00 covered call offers $465 in premium.

The annualized return by writing covered calls in March is 22.84%, in April is 12.22% and in May is 12.65%.

Chart for MET

An April covered call on GS at strike $340.00 using 300 shares is offering an income potential of $87.

The annualized return by writing covered calls in April is 0.74%.

Chart for GS


Industrials Focus: Income Opportunities

A March covered call on UNP at strike $107.00 using 300 shares is offering an income potential of $501. In April, a strike 110.00 covered call offers $642 and in May, a strike 110.00 covered call offers $885 in premium.

The annualized return by writing covered calls in March is 25.23%, in April is 12.88% and in May is 12.07%.

Chart for UNP

A May covered call on UTX at strike $130.00 using 300 shares is offering an income potential of $78.

The annualized return by writing covered calls in May is 1.00%.

Chart for UTX


Materials Focus: Income Opportunities

A March covered call on NEM at strike $39.00 using 300 shares is offering an income potential of $378.

The annualized return by writing covered calls in March is 60.42%.

Chart for NEM

A March covered call on LYB at strike $93.50 using 300 shares is offering an income potential of $435. In April, a strike 95.00 covered call offers $630 and in June, a strike 95.00 covered call offers $1,050 in premium.

The annualized return by writing covered calls in March is 25.10%, in April is 14.52% and in June is 12.50%.

Chart for LYB


Utilities Focus: Income Opportunities

A March covered call on D at strike $77.50 using 300 shares is offering an income potential of $75. In April, a strike 77.50 covered call offers $255 and in July, a strike 77.50 covered call offers $540 in premium.

The annualized return by writing covered calls in March is 5.23%, in April is 7.10% and in July is 5.93%.

Chart for D

A March covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $75. In April, a strike 67.50 covered call offers $225 and in May, a strike 67.50 covered call offers $315 in premium.

The annualized return by writing covered calls in March is 6.03%, in April is 7.23% and in May is 6.86%.

Chart for AEP


Telecommunications Focus: Income Opportunities

A June covered call on LVLT at strike $60.00 using 300 shares is offering an income potential of $285.

The annualized return by writing covered calls in June is 5.35%.

Chart for LVLT

A March covered call on SBAC at strike $115.00 using 300 shares is offering an income potential of $315. In April, a strike 115.00 covered call offers $675 and in June, a strike 115.00 covered call offers $675 in premium.

The annualized return by writing covered calls in March is 15.13%, in April is 13.00% and in June is 6.61%.

Chart for SBAC

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

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