Income Alerts Newsletter for 03/15/2017

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 $131.50 for April 7 2017 are offering a 0.82% return, which annualizes at a rate of 12.50%.

Chart for QQQ

The DIA options at strike $209.00 for April 13 2017 are offering a 0.90% return, which annualizes at a rate of 11.01%.

Chart for DIA

The SPY options at strike $237.00 for April 5 2017 are offering a 0.69% return, which annualizes at a rate of 11.49%.

Chart for SPY


Technology Focus: Income Opportunities

A March covered call on QCOM at strike $58.50 using 300 shares is offering an income potential of $93. In April, a strike 60.00 covered call offers $306 and in May, a strike 60.00 covered call offers $456 in premium.

The annualized return by writing covered calls in March is 48.85%, in April is 16.69% and in May is 14.60%.

Chart for QCOM

A March covered call on PCLN at strike $1770.00 using 300 shares is offering an income potential of $2,280. In April, a strike 1770.00 covered call offers $8,760 and in May, a strike 1770.00 covered call offers $18,300 in premium.

The annualized return by writing covered calls in March is 39.37%, in April is 15.71% and in May is 19.46%.

Chart for PCLN


Energy Focus: Income Opportunities

A March covered call on VLO at strike $67.50 using 300 shares is offering an income potential of $186. In April, a strike 67.50 covered call offers $585 and in June, a strike 67.50 covered call offers $1,035 in premium.

The annualized return by writing covered calls in March is 84.67%, in April is 27.87% and in June is 20.71%.

Chart for VLO


Healthcare Focus: Income Opportunities

A March covered call on JNJ at strike $128.00 using 300 shares is offering an income potential of $78. In April, a strike 130.00 covered call offers $282 and in May, a strike 130.00 covered call offers $450 in premium.

The annualized return by writing covered calls in March is 18.71%, in April is 6.98% and in May is 6.51%.

Chart for JNJ

A March covered call on MCK at strike $148.00 using 300 shares is offering an income potential of $435. In April, a strike 150.00 covered call offers $750 and in May, a strike 150.00 covered call offers $1,500 in premium.

The annualized return by writing covered calls in March is 90.84%, in April is 16.18% and in May is 19.17%.

Chart for MCK


Consumer Staples Focus: Income Opportunities

A March covered call on CVS at strike $80.00 using 300 shares is offering an income potential of $120. In April, a strike 80.00 covered call offers $417 and in May, a strike 80.00 covered call offers $624 in premium.

The annualized return by writing covered calls in March is 45.92%, in April is 16.57% and in May is 14.56%.

Chart for CVS

An April covered call on KO at strike $42.00 using 300 shares is offering an income potential of $189. In May, a strike 42.00 covered call offers $288 in premium.

The annualized return by writing covered calls in April is 14.26% and in May is 12.75%.

Chart for KO


Consumer Discretionary Focus: Income Opportunities

A March covered call on CMCSA at strike $50.00 using 300 shares is offering an income potential of $7,185. In April, a strike 37.50 covered call offers $186 and in May, a strike 37.50 covered call offers $315 in premium.

The annualized return by writing covered calls in March is 16,236.53%, in April is 15.77% and in May is 15.73%.

Chart for CMCSA

A March covered call on GM at strike $37.00 using 300 shares is offering an income potential of $81. In April, a strike 37.00 covered call offers $330 and in June, a strike 37.00 covered call offers $567 in premium.

The annualized return by writing covered calls in March is 67.15%, in April is 28.71% and in June is 20.71%.

Chart for GM


Financials Focus: Income Opportunities

A March covered call on MET at strike $54.00 using 300 shares is offering an income potential of $120. In April, a strike 55.00 covered call offers $303 and in May, a strike 55.00 covered call offers $471 in premium.

The annualized return by writing covered calls in March is 68.24%, in April is 17.88% and in May is 16.35%.

Chart for MET

An April covered call on BAC at strike $26.00 using 300 shares is offering an income potential of $144. In May, a strike 26.00 covered call offers $237 in premium.

The annualized return by writing covered calls in April is 18.08% and in May is 17.54%.

Chart for BAC


Industrials Focus: Income Opportunities

A March covered call on BA at strike $180.00 using 300 shares is offering an income potential of $186. In April, a strike 180.00 covered call offers $1,035 and in May, a strike 180.00 covered call offers $1,515 in premium.

The annualized return by writing covered calls in March is 31.76%, in April is 18.42% and in May is 15.84%.

Chart for BA

A March covered call on DHR at strike $87.50 using 300 shares is offering an income potential of $135. In April, a strike 87.50 covered call offers $285 and in June, a strike 87.50 covered call offers $630 in premium.

The annualized return by writing covered calls in March is 47.52%, in April is 10.35% and in June is 9.52%.

Chart for DHR


Materials Focus: Income Opportunities

An April covered call on DOW at strike $65.00 using 300 shares is offering an income potential of $156. In June, a strike 65.00 covered call offers $486 in premium.

The annualized return by writing covered calls in April is 7.71% and in June is 10.03%.

Chart for DOW

An April covered call on HUN at strike $23.00 using 300 shares is offering an income potential of $135. In May, a strike 23.00 covered call offers $240 in premium.

The annualized return by writing covered calls in April is 19.27% and in May is 20.27%.

Chart for HUN


Utilities Focus: Income Opportunities

An April covered call on NEE at strike $135.00 using 300 shares is offering an income potential of $165. In June, a strike 135.00 covered call offers $465 in premium.

The annualized return by writing covered calls in April is 3.96% and in June is 4.62%.

Chart for NEE

An April covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $120. In May, a strike 67.50 covered call offers $225 in premium.

The annualized return by writing covered calls in April is 5.73% and in May is 6.28%.

Chart for AEP


Telecommunications Focus: Income Opportunities

A May covered call on T at strike $43.00 using 300 shares is offering an income potential of $153.

The annualized return by writing covered calls in May is 6.68%.

Chart for T

A March covered call on TMUS at strike $61.50 using 300 shares is offering an income potential of $150. In April, a strike 62.50 covered call offers $480 and in May, a strike 62.50 covered call offers $870 in premium.

The annualized return by writing covered calls in March is 74.98%, in April is 25.06% and in May is 27.03%.

Chart for TMUS

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

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