Income Alerts Newsletter for 03/29/2016

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 $107.50 for April 22 2016 are offering a 1.54% return, which annualizes at a rate of 22.42%.

Chart for QQQ

The DIA options at strike $175.50 for April 22 2016 are offering a 1.27% return, which annualizes at a rate of 18.49%.

Chart for DIA

The SPY options at strike $203.50 for April 22 2016 are offering a 1.23% return, which annualizes at a rate of 17.89%.

Chart for SPY


Technology Focus: Income Opportunities

An April covered call on QCOM at strike $51.00 using 300 shares is offering an income potential of $189. In May, a strike 52.50 covered call offers $363 and in June, a strike 52.50 covered call offers $423 in premium.

The annualized return by writing covered calls in April is 24.42%, in May is 16.70% and in June is 12.87%.

Chart for QCOM

An April covered call on BABA at strike $77.00 using 300 shares is offering an income potential of $513. In May, a strike 77.50 covered call offers $1,050 and in July, a strike 77.50 covered call offers $1,440 in premium.

The annualized return by writing covered calls in April is 43.93%, in May is 32.42% and in July is 22.22%.

Chart for BABA


Energy Focus: Income Opportunities

An April covered call on HES at strike $52.50 using 300 shares is offering an income potential of $330. In May, a strike 52.50 covered call offers $774 and in June, a strike 52.50 covered call offers $1,200 in premium.

The annualized return by writing covered calls in April is 42.48%, in May is 36.14% and in June is 38.01%.

Chart for HES

An April covered call on SLB at strike $73.00 using 300 shares is offering an income potential of $402. In May, a strike 75.00 covered call offers $525 and in August, a strike 75.00 covered call offers $960 in premium.

The annualized return by writing covered calls in April is 36.02%, in May is 16.65% and in August is 11.57%.

Chart for SLB


Healthcare Focus: Income Opportunities

An April covered call on GILD at strike $92.50 using 300 shares is offering an income potential of $579. In May, a strike 92.50 covered call offers $1,140 and in June, a strike 92.50 covered call offers $1,350 in premium.

The annualized return by writing covered calls in April is 40.95%, in May is 28.97% and in June is 22.77%.

Chart for GILD

An April covered call on HCA at strike $76.50 using 300 shares is offering an income potential of $540. In May, a strike 77.50 covered call offers $855 and in June, a strike 77.50 covered call offers $1,020 in premium.

The annualized return by writing covered calls in April is 46.33%, in May is 26.18% and in June is 20.72%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

An April covered call on ADM at strike $37.00 using 300 shares is offering an income potential of $159. In May, a strike 38.00 covered call offers $261 and in June, a strike 37.00 covered call offers $432 in premium.

The annualized return by writing covered calls in April is 28.42%, in May is 16.57% and in June is 18.36%.

Chart for ADM

An April covered call on CVS at strike $102.00 using 300 shares is offering an income potential of $363. In May, a strike 105.00 covered call offers $339 and in August, a strike 105.00 covered call offers $789 in premium.

The annualized return by writing covered calls in April is 23.10%, in May is 7.58% and in August is 6.67%.

Chart for CVS


Consumer Discretionary Focus: Income Opportunities

An April covered call on AMZN at strike $580.00 using 300 shares is offering an income potential of $4,200. In May, a strike 580.00 covered call offers $9,855 and in June, a strike 580.00 covered call offers $11,220 in premium.

The annualized return by writing covered calls in April is 47.53%, in May is 40.59% and in June is 30.69%.

Chart for AMZN

An April covered call on FOXA at strike $28.00 using 300 shares is offering an income potential of $135. In May, a strike 29.00 covered call offers $180 and in July, a strike 28.00 covered call offers $420 in premium.

The annualized return by writing covered calls in April is 31.50%, in May is 14.86% and in July is 17.54%.

Chart for FOXA


Financials Focus: Income Opportunities

A May covered call on BAC at strike $14.00 using 300 shares is offering an income potential of $132. In June, a strike 14.00 covered call offers $162 in premium.

The annualized return by writing covered calls in May is 22.57% and in June is 18.38%.

Chart for BAC

An April covered call on GS at strike $155.00 using 300 shares is offering an income potential of $843. In May, a strike 155.00 covered call offers $1,695 and in July, a strike 155.00 covered call offers $2,310 in premium.

The annualized return by writing covered calls in April is 35.74%, in May is 25.77% and in July is 17.48%.

Chart for GS


Industrials Focus: Income Opportunities

An April covered call on UTX at strike $99.00 using 300 shares is offering an income potential of $447. In May, a strike 100.00 covered call offers $621 and in August, a strike 100.00 covered call offers $1,065 in premium.

The annualized return by writing covered calls in April is 29.38%, in May is 14.45% and in August is 9.37%.

Chart for UTX

An April covered call on UPS at strike $106.00 using 300 shares is offering an income potential of $360. In May, a strike 110.00 covered call offers $240 and in July, a strike 110.00 covered call offers $390 in premium.

The annualized return by writing covered calls in April is 22.20%, in May is 5.19% and in July is 4.16%.

Chart for UPS


Materials Focus: Income Opportunities

An April covered call on FCX at strike $10.50 using 300 shares is offering an income potential of $171. In May, a strike 11.00 covered call offers $285 and in August, a strike 11.00 covered call offers $462 in premium.

The annualized return by writing covered calls in April is 114.42%, in May is 69.87% and in August is 45.08%.

Chart for FCX

An April covered call on HUN at strike $13.00 using 300 shares is offering an income potential of $150. In May, a strike 13.00 covered call offers $300 and in August, a strike 13.00 covered call offers $510 in premium.

The annualized return by writing covered calls in April is 77.40%, in May is 56.75% and in August is 38.17%.

Chart for HUN


Utilities Focus: Income Opportunities

An April covered call on ED at strike $77.50 using 300 shares is offering an income potential of $105. In May, a strike 77.50 covered call offers $300 and in August, a strike 77.50 covered call offers $420 in premium.

The annualized return by writing covered calls in April is 8.94%, in May is 9.07% and in August is 4.75%.

Chart for ED

An April covered call on NEE at strike $120.00 using 300 shares is offering an income potential of $210. In May, a strike 120.00 covered call offers $585 and in June, a strike 120.00 covered call offers $690 in premium.

The annualized return by writing covered calls in April is 11.51%, in May is 11.40% and in June is 8.88%.

Chart for NEE


Telecommunications Focus: Income Opportunities

An April covered call on CTL at strike $32.00 using 300 shares is offering an income potential of $90. In May, a strike 32.00 covered call offers $300 and in July, a strike 32.00 covered call offers $390 in premium.

The annualized return by writing covered calls in April is 18.72%, in May is 22.47% and in July is 14.49%.

Chart for CTL

An April covered call on VZ at strike $53.50 using 300 shares is offering an income potential of $123. In May, a strike 55.00 covered call offers $105 and in June, a strike 55.00 covered call offers $168 in premium.

The annualized return by writing covered calls in April is 14.86%, in May is 4.46% and in June is 4.72%.

Chart for VZ

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

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