Income Alerts Newsletter for 06/10/2016

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 1.07% return, which annualizes at a rate of 17.81%.

Chart for QQQ

The DIA options at strike $180.00 for June 30 2016 are offering a 0.99% return, which annualizes at a rate of 17.17%.

Chart for DIA

The SPY options at strike $212.50 for July 1 2016 are offering a 0.85% return, which annualizes at a rate of 14.04%.

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 $129. In July, a strike 55.00 covered call offers $363 and in August, a strike 55.00 covered call offers $639 in premium.

The annualized return by writing covered calls in June is 31.97%, in July is 22.20% and in August is 20.43%.

Chart for QCOM

A June covered call on AAPL at strike $100.00 using 300 shares is offering an income potential of $240. In July, a strike 100.00 covered call offers $684 and in August, a strike 100.00 covered call offers $1,095 in premium.

The annualized return by writing covered calls in June is 32.82%, in July is 23.10% and in August is 19.27%.

Chart for AAPL


Energy Focus: Income Opportunities

A June covered call on SLB at strike $80.00 using 300 shares is offering an income potential of $306. In July, a strike 80.00 covered call offers $672 and in August, a strike 80.00 covered call offers $1,005 in premium.

The annualized return by writing covered calls in June is 52.40%, in July is 28.43% and in August is 22.17%.

Chart for SLB

A June covered call on APC at strike $54.50 using 300 shares is offering an income potential of $351. In July, a strike 55.00 covered call offers $669 and in August, a strike 55.00 covered call offers $1,050 in premium.

The annualized return by writing covered calls in June is 89.01%, in July is 42.10% and in August is 34.80%.

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 $111. In August, a strike 36.00 covered call offers $186 in premium.

The annualized return by writing covered calls in July is 10.45% and in August is 9.06%.

Chart for PFE

A June covered call on ESRX at strike $77.00 using 300 shares is offering an income potential of $216. In July, a strike 77.50 covered call offers $456 and in August, a strike 77.50 covered call offers $801 in premium.

The annualized return by writing covered calls in June is 38.32%, in July is 19.88% and in August is 18.23%.

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 $180. In July, a strike 80.00 covered call offers $657 and in October, a strike 80.00 covered call offers $1,200 in premium.

The annualized return by writing covered calls in June is 31.03%, in July is 28.12% and in October is 14.42%.

Chart for WBA

A July covered call on KO at strike $46.00 using 300 shares is offering an income potential of $114. In August, a strike 46.00 covered call offers $249 in premium.

The annualized return by writing covered calls in July is 8.26% and in August is 9.36%.

Chart for KO


Consumer Discretionary Focus: Income Opportunities

A June covered call on AMZN at strike $730.00 using 300 shares is offering an income potential of $2,070. In July, a strike 730.00 covered call offers $5,730 and in August, a strike 730.00 covered call offers $11,805 in premium.

The annualized return by writing covered calls in June is 38.83%, in July is 26.59% and in August is 28.98%.

Chart for AMZN

A June covered call on CMCSA at strike $63.00 using 300 shares is offering an income potential of $162. In July, a strike 65.00 covered call offers $111 and in October, a strike 65.00 covered call offers $522 in premium.

The annualized return by writing covered calls in June is 35.10%, in July is 5.83% and in October is 7.69%.

Chart for CMCSA


Financials Focus: Income Opportunities

A June covered call on JPM at strike $65.00 using 300 shares is offering an income potential of $159. In July, a strike 65.00 covered call offers $429 and in August, a strike 65.00 covered call offers $585 in premium.

The annualized return by writing covered calls in June is 33.47%, in July is 22.28% and in August is 15.74%.

Chart for JPM

A June covered call on AXP at strike $66.00 using 300 shares is offering an income potential of $144. In July, a strike 67.50 covered call offers $186 and in October, a strike 67.50 covered call offers $636 in premium.

The annualized return by writing covered calls in June is 29.84%, in July is 9.40% and in October is 9.01%.

Chart for AXP


Industrials Focus: Income Opportunities

A June covered call on UNP at strike $89.50 using 300 shares is offering an income potential of $177. In July, a strike 90.00 covered call offers $534 and in August, a strike 90.00 covered call offers $828 in premium.

The annualized return by writing covered calls in June is 26.95%, in July is 20.04% and in August is 16.15%.

Chart for UNP

A July covered call on HTZ at strike $12.00 using 300 shares is offering an income potential of $105. In September, a strike 12.00 covered call offers $255 in premium.

The annualized return by writing covered calls in July is 31.88% and in September is 30.03%.

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 $165. In August, a strike 115.00 covered call offers $405 in premium.

The annualized return by writing covered calls in July is 4.94% and in August is 6.27%.

Chart for PPG

A June covered call on CF at strike $30.00 using 300 shares is offering an income potential of $231. In July, a strike 30.00 covered call offers $504 and in August, a strike 30.00 covered call offers $678 in premium.

The annualized return by writing covered calls in June is 107.61%, in July is 58.96% and in August is 41.62%.

Chart for CF


Utilities Focus: Income Opportunities

A June covered call on ED at strike $77.50 using 300 shares is offering an income potential of $90. In July, a strike 77.50 covered call offers $300 and in August, a strike 77.50 covered call offers $465 in premium.

The annualized return by writing covered calls in June is 15.96%, in July is 13.06% and in August is 10.48%.

Chart for ED

A June covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $90. In July, a strike 67.50 covered call offers $270 and in August, a strike 67.50 covered call offers $405 in premium.

The annualized return by writing covered calls in June is 18.25%, in July is 13.44% and in August is 10.43%.

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 $90. In July, a strike 105.00 covered call offers $495 and in September, a strike 105.00 covered call offers $720 in premium.

The annualized return by writing covered calls in June is 11.75%, in July is 15.93% and in September is 8.64%.

Chart for SBAC

A June covered call on VZ at strike $52.00 using 300 shares is offering an income potential of $114. In July, a strike 52.50 covered call offers $165 and in August, a strike 52.50 covered call offers $273 in premium.

The annualized return by writing covered calls in June is 29.88%, in July is 10.56% and in August is 9.04%.

Chart for VZ

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

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