Income Alerts Newsletter for 05/22/2017

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 $138.00 for June 16 2017 are offering a 1.17% return, which annualizes at a rate of 15.88%.

Chart for QQQ

The DIA options at strike $208.00 for June 16 2017 are offering a 0.96% return, which annualizes at a rate of 12.94%.

Chart for DIA

The SPY options at strike $238.50 for June 14 2017 are offering a 0.97% return, which annualizes at a rate of 14.17%.

Chart for SPY


Technology Focus: Income Opportunities

A June covered call on QCOM at strike $60.00 using 300 shares is offering an income potential of $81. In July, a strike 60.00 covered call offers $315 and in October, a strike 60.00 covered call offers $618 in premium.

The annualized return by writing covered calls in June is 6.36%, in July is 10.92% and in October is 8.84%.

Chart for QCOM

A June covered call on FB at strike $150.00 using 300 shares is offering an income potential of $627. In July, a strike 150.00 covered call offers $1,200 and in August, a strike 150.00 covered call offers $1,830 in premium.

The annualized return by writing covered calls in June is 19.36%, in July is 16.35% and in August is 17.43%.

Chart for FB


Energy Focus: Income Opportunities

A June covered call on SLB at strike $72.50 using 300 shares is offering an income potential of $291. In July, a strike 72.50 covered call offers $513 and in August, a strike 72.50 covered call offers $681 in premium.

The annualized return by writing covered calls in June is 18.53%, in July is 14.37% and in August is 13.25%.

Chart for SLB

A June covered call on EOG at strike $95.00 using 300 shares is offering an income potential of $588. In July, a strike 95.00 covered call offers $975 and in October, a strike 95.00 covered call offers $1,695 in premium.

The annualized return by writing covered calls in June is 28.85%, in July is 21.13% and in October is 15.29%.

Chart for EOG


Healthcare Focus: Income Opportunities

A June covered call on MRK at strike $65.00 using 300 shares is offering an income potential of $150. In July, a strike 65.00 covered call offers $264 and in September, a strike 65.00 covered call offers $528 in premium.

The annualized return by writing covered calls in June is 10.68%, in July is 8.24% and in September is 8.78%.

Chart for MRK

A June covered call on MCK at strike $155.00 using 300 shares is offering an income potential of $645. In August, a strike 155.00 covered call offers $1,740 and in November, a strike 155.00 covered call offers $2,700 in premium.

The annualized return by writing covered calls in June is 19.27%, in August is 15.98% and in November is 12.60%.

Chart for MCK


Consumer Staples Focus: Income Opportunities

A June covered call on PM at strike $115.00 using 300 shares is offering an income potential of $480. In September, a strike 115.00 covered call offers $1,080 and in December, a strike 115.00 covered call offers $1,545 in premium.

The annualized return by writing covered calls in June is 19.12%, in September is 10.02% and in December is 8.21%.

Chart for PM

A June covered call on STZ at strike $185.00 using 300 shares is offering an income potential of $720. In July, a strike 185.00 covered call offers $1,770 and in October, a strike 185.00 covered call offers $2,880 in premium.

The annualized return by writing covered calls in June is 17.97%, in July is 19.62% and in October is 13.21%.

Chart for STZ


Consumer Discretionary Focus: Income Opportunities

A June covered call on CMCSA at strike $40.00 using 300 shares is offering an income potential of $93. In July, a strike 40.00 covered call offers $195 and in August, a strike 40.00 covered call offers $303 in premium.

The annualized return by writing covered calls in June is 10.87%, in July is 10.02% and in August is 10.82%.

Chart for CMCSA

A June covered call on DG at strike $72.50 using 300 shares is offering an income potential of $585. In August, a strike 72.50 covered call offers $900 and in November, a strike 72.50 covered call offers $1,380 in premium.

The annualized return by writing covered calls in June is 37.66%, in August is 17.65% and in November is 13.77%.

Chart for DG


Financials Focus: Income Opportunities

A June covered call on GS at strike $220.00 using 300 shares is offering an income potential of $744. In July, a strike 220.00 covered call offers $1,515 and in September, a strike 220.00 covered call offers $2,325 in premium.

The annualized return by writing covered calls in June is 15.75%, in July is 14.13% and in September is 11.55%.

Chart for GS

A June covered call on MS at strike $42.00 using 300 shares is offering an income potential of $282. In July, a strike 42.00 covered call offers $471 and in September, a strike 42.00 covered call offers $639 in premium.

The annualized return by writing covered calls in June is 31.10%, in July is 22.97% and in September is 16.61%.

Chart for MS


Industrials Focus: Income Opportunities

A June covered call on UPS at strike $105.00 using 300 shares is offering an income potential of $291. In July, a strike 105.00 covered call offers $558 and in October, a strike 105.00 covered call offers $1,035 in premium.

The annualized return by writing covered calls in June is 12.80%, in July is 10.78% and in October is 8.23%.

Chart for UPS

A June covered call on UNP at strike $110.00 using 300 shares is offering an income potential of $291. In August, a strike 110.00 covered call offers $945 and in September, a strike 110.00 covered call offers $1,080 in premium.

The annualized return by writing covered calls in June is 12.36%, in August is 12.30% and in September is 10.76%.

Chart for UNP


Materials Focus: Income Opportunities

A June covered call on CF at strike $30.00 using 300 shares is offering an income potential of $171. In August, a strike 30.00 covered call offers $456 and in November, a strike 30.00 covered call offers $702 in premium.

The annualized return by writing covered calls in June is 27.53%, in August is 22.80% and in November is 18.00%.

Chart for CF

A June covered call on LYB at strike $82.50 using 300 shares is offering an income potential of $375. In September, a strike 82.50 covered call offers $1,020 and in December, a strike 82.50 covered call offers $1,470 in premium.

The annualized return by writing covered calls in June is 21.16%, in September is 13.54% and in December is 11.23%.

Chart for LYB


Utilities Focus: Income Opportunities

A June covered call on NRG at strike $16.00 using 300 shares is offering an income potential of $165. In September, a strike 16.00 covered call offers $390 and in December, a strike 16.00 covered call offers $480 in premium.

The annualized return by writing covered calls in June is 49.04%, in September is 27.91% and in December is 19.80%.

Chart for NRG

A June covered call on D at strike $80.00 using 300 shares is offering an income potential of $90. In July, a strike 80.00 covered call offers $255 and in October, a strike 80.00 covered call offers $540 in premium.

The annualized return by writing covered calls in June is 5.18%, in July is 6.44% and in October is 5.59%.

Chart for D


Telecommunications Focus: Income Opportunities

An October covered call on VOD at strike $30.00 using 300 shares is offering an income potential of $159.

The annualized return by writing covered calls in October is 4.41%.

Chart for VOD

A June covered call on CTL at strike $25.00 using 300 shares is offering an income potential of $75. In July, a strike 25.00 covered call offers $150 and in September, a strike 25.00 covered call offers $270 in premium.

The annualized return by writing covered calls in June is 13.73%, in July is 12.08% and in September is 11.61%.

Chart for CTL

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

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