Income Alerts Newsletter for 02/27/2017

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 DIA options at strike $208.00 for March 18 2017 are offering a 0.81% return, which annualizes at a rate of 15.65%.

Chart for DIA


Technology Focus: Income Opportunities

A March covered call on QCOM at strike $57.50 using 300 shares is offering an income potential of $231. In April, a strike 57.50 covered call offers $543 and in May, a strike 60.00 covered call offers $396 in premium.

The annualized return by writing covered calls in March is 26.20%, in April is 22.08% and in May is 10.51%.

Chart for QCOM

A March covered call on BABA at strike $103.00 using 300 shares is offering an income potential of $660. In April, a strike 105.00 covered call offers $864 and in May, a strike 105.00 covered call offers $1,350 in premium.

The annualized return by writing covered calls in March is 41.95%, in April is 19.45% and in May is 20.35%.

Chart for BABA


Energy Focus: Income Opportunities

A March covered call on VLO at strike $67.00 using 300 shares is offering an income potential of $390. In April, a strike 67.50 covered call offers $630 and in June, a strike 67.50 covered call offers $960 in premium.

The annualized return by writing covered calls in March is 38.17%, in April is 21.97% and in June is 16.72%.

Chart for VLO


Healthcare Focus: Income Opportunities

A March covered call on JNJ at strike $123.00 using 300 shares is offering an income potential of $372. In April, a strike 125.00 covered call offers $429 and in May, a strike 125.00 covered call offers $528 in premium.

The annualized return by writing covered calls in March is 19.61%, in April is 7.97% and in May is 6.48%.

Chart for JNJ

A March covered call on PFE at strike $34.50 using 300 shares is offering an income potential of $96. In April, a strike 35.00 covered call offers $135 and in May, a strike 35.00 covered call offers $186 in premium.

The annualized return by writing covered calls in March is 15.64%, in April is 8.52% and in May is 7.91%.

Chart for PFE


Consumer Staples Focus: Income Opportunities

A March covered call on ADM at strike $45.50 using 300 shares is offering an income potential of $192. In April, a strike 46.00 covered call offers $291 and in June, a strike 48.00 covered call offers $273 in premium.

The annualized return by writing covered calls in March is 27.55%, in April is 14.80% and in June is 6.81%.

Chart for ADM

A March covered call on KO at strike $42.00 using 300 shares is offering an income potential of $78. In April, a strike 42.00 covered call offers $168 and in May, a strike 42.00 covered call offers $243 in premium.

The annualized return by writing covered calls in March is 10.39%, in April is 8.70% and in May is 8.49%.

Chart for KO


Consumer Discretionary Focus: Income Opportunities

A March covered call on GM at strike $37.00 using 300 shares is offering an income potential of $204. In April, a strike 37.00 covered call offers $345 and in June, a strike 37.00 covered call offers $537 in premium.

The annualized return by writing covered calls in March is 36.07%, in April is 21.74% and in June is 16.92%.

Chart for GM

A March covered call on HD at strike $146.00 using 300 shares is offering an income potential of $465. In April, a strike 150.00 covered call offers $381 and in May, a strike 150.00 covered call offers $705 in premium.

The annualized return by writing covered calls in March is 20.62%, in April is 5.93% and in May is 7.28%.

Chart for HD


Financials Focus: Income Opportunities

A March covered call on BAC at strike $24.50 using 300 shares is offering an income potential of $108. In April, a strike 25.00 covered call offers $174 and in May, a strike 25.00 covered call offers $249 in premium.

The annualized return by writing covered calls in March is 28.97%, in April is 16.58% and in May is 15.79%.

Chart for BAC

A March covered call on MS at strike $46.00 using 300 shares is offering an income potential of $237. In April, a strike 46.00 covered call offers $462 and in May, a strike 50.00 covered call offers $192 in premium.

The annualized return by writing covered calls in March is 33.92%, in April is 23.66% and in May is 6.35%.

Chart for MS


Industrials Focus: Income Opportunities

A March covered call on UNP at strike $108.00 using 300 shares is offering an income potential of $549. In April, a strike 110.00 covered call offers $813 and in May, a strike 110.00 covered call offers $1,080 in premium.

The annualized return by writing covered calls in March is 33.19%, in April is 17.44% and in May is 15.39%.

Chart for UNP

A March covered call on UTX at strike $113.00 using 300 shares is offering an income potential of $339. In April, a strike 115.00 covered call offers $369 and in May, a strike 115.00 covered call offers $597 in premium.

The annualized return by writing covered calls in March is 19.50%, in April is 7.47% and in May is 8.02%.

Chart for UTX


Materials Focus: Income Opportunities

An April covered call on HUN at strike $23.00 using 300 shares is offering an income potential of $150. In May, a strike 23.00 covered call offers $240 in premium.

The annualized return by writing covered calls in April is 15.66% and in May is 16.73%.

Chart for HUN

A March covered call on NEM at strike $36.50 using 300 shares is offering an income potential of $282. In April, a strike 37.00 covered call offers $444 and in May, a strike 37.00 covered call offers $618 in premium.

The annualized return by writing covered calls in March is 51.39%, in April is 28.91% and in May is 26.95%.

Chart for NEM


Utilities Focus: Income Opportunities

A March covered call on D at strike $77.50 using 300 shares is offering an income potential of $150. In April, a strike 77.50 covered call offers $345 and in July, a strike 77.50 covered call offers $630 in premium.

The annualized return by writing covered calls in March is 12.56%, in April is 10.25% and in July is 7.06%.

Chart for D

A March covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $195. In April, a strike 67.50 covered call offers $375 and in May, a strike 67.50 covered call offers $480 in premium.

The annualized return by writing covered calls in March is 16.22%, in April is 12.15% and in May is 10.48%.

Chart for AEP


Telecommunications Focus: Income Opportunities

A March covered call on VOD at strike $26.00 using 300 shares is offering an income potential of $84. In April, a strike 26.00 covered call offers $177 and in July, a strike 26.00 covered call offers $297 in premium.

The annualized return by writing covered calls in March is 21.14%, in April is 15.86% and in July is 10.07%.

Chart for VOD

A March covered call on VZ at strike $51.00 using 300 shares is offering an income potential of $150. In April, a strike 52.50 covered call offers $129 and in May, a strike 52.50 covered call offers $198 in premium.

The annualized return by writing covered calls in March is 19.17%, in April is 5.79% and in May is 5.88%.

Chart for VZ

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

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