Income Alerts Newsletter for 06/09/2016

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 $110.50 for July 1 2016 are offering a 1.15% return, which annualizes at a rate of 18.18%.

Chart for QQQ

The DIA options at strike $180.50 for July 1 2016 are offering a 0.89% return, which annualizes at a rate of 14.05%.

Chart for DIA

The SPY options at strike $212.50 for July 1 2016 are offering a 0.91% return, which annualizes at a rate of 14.48%.

Chart for SPY


Technology Focus: Income Opportunities

A June covered call on QCOM at strike $55.00 using 300 shares is offering an income potential of $153. In July, a strike 55.00 covered call offers $372 and in August, a strike 55.00 covered call offers $657 in premium.

The annualized return by writing covered calls in June is 34.20%, in July is 22.18% and in August is 20.76%.

Chart for QCOM

A June covered call on AAPL at strike $99.00 using 300 shares is offering an income potential of $300. In July, a strike 100.00 covered call offers $543 and in August, a strike 100.00 covered call offers $990 in premium.

The annualized return by writing covered calls in June is 37.27%, in July is 17.90% and in August is 17.25%.

Chart for AAPL


Energy Focus: Income Opportunities

A June covered call on SLB at strike $81.00 using 300 shares is offering an income potential of $294. In July, a strike 82.50 covered call offers $435 and in August, a strike 82.50 covered call offers $744 in premium.

The annualized return by writing covered calls in June is 44.81%, in July is 17.55% and in August is 15.83%.

Chart for SLB

A June covered call on APC at strike $55.50 using 300 shares is offering an income potential of $291. In July, a strike 57.50 covered call offers $465 and in August, a strike 57.50 covered call offers $786 in premium.

The annualized return by writing covered calls in June is 65.31%, in July is 27.76% and in August is 24.92%.

Chart for APC


Healthcare Focus: Income Opportunities

A July covered call on PFE at strike $36.00 using 300 shares is offering an income potential of $96. In August, a strike 36.00 covered call offers $168 in premium.

The annualized return by writing covered calls in July is 8.80% and in August is 8.07%.

Chart for PFE

A June covered call on ESRX at strike $77.00 using 300 shares is offering an income potential of $225. In July, a strike 77.50 covered call offers $480 and in August, a strike 77.50 covered call offers $765 in premium.

The annualized return by writing covered calls in June is 35.97%, in July is 20.42% and in August is 17.16%.

Chart for ESRX


Consumer Staples Focus: Income Opportunities

A June covered call on WBA at strike $79.50 using 300 shares is offering an income potential of $252. In July, a strike 80.00 covered call offers $705 and in October, a strike 80.00 covered call offers $1,260 in premium.

The annualized return by writing covered calls in June is 39.01%, in July is 29.28% and in October is 14.98%.

Chart for WBA

A July covered call on KO at strike $46.00 using 300 shares is offering an income potential of $102. In August, a strike 46.00 covered call offers $225 in premium.

The annualized return by writing covered calls in July is 7.22% and in August is 8.37%.

Chart for KO


Consumer Discretionary Focus: Income Opportunities

A June covered call on AMZN at strike $727.50 using 300 shares is offering an income potential of $2,445. In July, a strike 730.00 covered call offers $5,535 and in August, a strike 730.00 covered call offers $11,760 in premium.

The annualized return by writing covered calls in June is 41.40%, in July is 25.02% and in August is 28.51%.

Chart for AMZN

A June covered call on CMCSA at strike $63.50 using 300 shares is offering an income potential of $156. In July, a strike 65.00 covered call offers $135 and in October, a strike 65.00 covered call offers $546 in premium.

The annualized return by writing covered calls in June is 30.27%, in July is 6.89% and in October is 7.96%.

Chart for CMCSA


Financials Focus: Income Opportunities

An August covered call on BAC at strike $15.00 using 300 shares is offering an income potential of $123.

The annualized return by writing covered calls in August is 14.62%.

Chart for BAC

A June covered call on JPM at strike $65.50 using 300 shares is offering an income potential of $159. In July, a strike 67.50 covered call offers $171 and in August, a strike 67.50 covered call offers $303 in premium.

The annualized return by writing covered calls in June is 29.89%, in July is 8.46% and in August is 7.86%.

Chart for JPM


Industrials Focus: Income Opportunities

A June covered call on UNP at strike $89.50 using 300 shares is offering an income potential of $228. In July, a strike 90.00 covered call offers $489 and in August, a strike 90.00 covered call offers $864 in premium.

The annualized return by writing covered calls in June is 31.42%, in July is 17.91% and in August is 16.71%.

Chart for UNP

A June covered call on HTZ at strike $11.50 using 300 shares is offering an income potential of $90. In July, a strike 12.00 covered call offers $120 and in September, a strike 12.00 covered call offers $285 in premium.

The annualized return by writing covered calls in June is 98.83%, in July is 34.99% and in September is 32.92%.

Chart for HTZ


Materials Focus: Income Opportunities

A July covered call on PPG at strike $115.00 using 300 shares is offering an income potential of $210. In August, a strike 115.00 covered call offers $495 in premium.

The annualized return by writing covered calls in July is 6.10% and in August is 7.55%.

Chart for PPG

A June covered call on CF at strike $31.50 using 300 shares is offering an income potential of $204. In July, a strike 35.00 covered call offers $138 and in August, a strike 35.00 covered call offers $303 in premium.

The annualized return by writing covered calls in June is 81.64%, in July is 14.43% and in August is 16.79%.

Chart for CF


Utilities Focus: Income Opportunities

A July covered call on ED at strike $77.50 using 300 shares is offering an income potential of $165. In August, a strike 77.50 covered call offers $315 in premium.

The annualized return by writing covered calls in July is 7.06% and in August is 7.06%.

Chart for ED

A July covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $180. In August, a strike 67.50 covered call offers $315 in premium.

The annualized return by writing covered calls in July is 8.79% and in August is 8.06%.

Chart for AEP


Telecommunications Focus: Income Opportunities

A June covered call on SBAC at strike $105.00 using 300 shares is offering an income potential of $210. In July, a strike 105.00 covered call offers $585 and in September, a strike 105.00 covered call offers $720 in premium.

The annualized return by writing covered calls in June is 24.71%, in July is 18.33% and in September is 8.53%.

Chart for SBAC

A July covered call on VZ at strike $52.50 using 300 shares is offering an income potential of $120. In August, a strike 52.50 covered call offers $219 in premium.

The annualized return by writing covered calls in July is 7.52% and in August is 7.19%.

Chart for VZ

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

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