Income Alerts Newsletter for 06/14/2016

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 $118.00 for July 22 2016 are offering a 0.01% return, which annualizes at a rate of 0.09%.

Chart for QQQ

The DIA options at strike $177.50 for July 8 2016 are offering a 1.60% return, which annualizes at a rate of 23.33%.

Chart for DIA

The SPY options at strike $208.50 for July 8 2016 are offering a 1.46% return, which annualizes at a rate of 21.32%.

Chart for SPY


Technology Focus: Income Opportunities

A June covered call on PCLN at strike $1317.50 using 300 shares is offering an income potential of $4,680. In July, a strike 1320.00 covered call offers $10,680 and in August, a strike 1320.00 covered call offers $19,710 in premium.

The annualized return by writing covered calls in June is 87.61%, in July is 30.77% and in August is 28.22%.

Chart for PCLN


Energy Focus: Income Opportunities

A June covered call on SLB at strike $78.00 using 300 shares is offering an income potential of $216. In July, a strike 80.00 covered call offers $423 and in August, a strike 80.00 covered call offers $756 in premium.

The annualized return by writing covered calls in June is 68.33%, in July is 20.46% and in August is 18.01%.

Chart for SLB

A June covered call on APC at strike $53.50 using 300 shares is offering an income potential of $216. In July, a strike 55.00 covered call offers $507 and in August, a strike 55.00 covered call offers $864 in premium.

The annualized return by writing covered calls in June is 100.38%, in July is 36.37% and in August is 30.79%.

Chart for APC


Healthcare Focus: Income Opportunities

A July covered call on PFE at strike $35.00 using 300 shares is offering an income potential of $183. In August, a strike 35.00 covered call offers $270 in premium.

The annualized return by writing covered calls in July is 19.77% and in August is 14.28%.

Chart for PFE

A June covered call on ESRX at strike $76.00 using 300 shares is offering an income potential of $213. In July, a strike 77.50 covered call offers $324 and in August, a strike 77.50 covered call offers $654 in premium.

The annualized return by writing covered calls in June is 69.26%, in July is 16.04% and in August is 15.95%.

Chart for ESRX


Consumer Staples Focus: Income Opportunities

A June covered call on WBA at strike $84.50 using 300 shares is offering an income potential of $132. In July, a strike 85.00 covered call offers $840 and in October, a strike 85.00 covered call offers $1,410 in premium.

The annualized return by writing covered calls in June is 38.27%, in July is 37.97% and in October is 16.44%.

Chart for WBA

A July covered call on KO at strike $46.00 using 300 shares is offering an income potential of $108. In August, a strike 46.00 covered call offers $240 in premium.

The annualized return by writing covered calls in July is 8.90% and in August is 9.69%.

Chart for KO


Consumer Discretionary Focus: Income Opportunities

A June covered call on AMZN at strike $717.50 using 300 shares is offering an income potential of $2,415. In July, a strike 720.00 covered call offers $5,595 and in August, a strike 720.00 covered call offers $11,730 in premium.

The annualized return by writing covered calls in June is 83.10%, in July is 29.61% and in August is 31.04%.

Chart for AMZN

A June covered call on CMCSA at strike $62.50 using 300 shares is offering an income potential of $177. In July, a strike 62.50 covered call offers $402 and in October, a strike 62.50 covered call offers $879 in premium.

The annualized return by writing covered calls in June is 69.69%, in July is 24.28% and in October is 13.73%.

Chart for CMCSA


Financials Focus: Income Opportunities

A June covered call on JPM at strike $63.50 using 300 shares is offering an income potential of $177. In July, a strike 65.00 covered call offers $318 and in August, a strike 65.00 covered call offers $504 in premium.

The annualized return by writing covered calls in June is 68.71%, in July is 18.85% and in August is 14.64%.

Chart for JPM


Industrials Focus: Income Opportunities

A June covered call on UNP at strike $89.00 using 300 shares is offering an income potential of $207. In July, a strike 90.00 covered call offers $564 and in August, a strike 90.00 covered call offers $894 in premium.

The annualized return by writing covered calls in June is 57.23%, in July is 23.95% and in August is 18.66%.

Chart for UNP

A July covered call on HTZ at strike $11.00 using 300 shares is offering an income potential of $135. In September, a strike 11.00 covered call offers $285 in premium.

The annualized return by writing covered calls in July is 49.53% and in September is 37.82%.

Chart for HTZ


Materials Focus: Income Opportunities

A June covered call on MON at strike $108.00 using 300 shares is offering an income potential of $240. In July, a strike 110.00 covered call offers $945 and in October, a strike 110.00 covered call offers $1,800 in premium.

The annualized return by writing covered calls in June is 54.96%, in July is 33.53% and in October is 16.54%.

Chart for MON

A June covered call on NEM at strike $36.00 using 300 shares is offering an income potential of $219. In July, a strike 36.00 covered call offers $585 and in August, a strike 36.00 covered call offers $852 in premium.

The annualized return by writing covered calls in June is 151.56%, in July is 63.55% and in August is 46.12%.

Chart for NEM


Utilities Focus: Income Opportunities

A June covered call on ED at strike $77.50 using 300 shares is offering an income potential of $135. In July, a strike 77.50 covered call offers $420 and in August, a strike 77.50 covered call offers $630 in premium.

The annualized return by writing covered calls in June is 42.79%, in July is 20.42% and in August is 15.01%.

Chart for ED

A June covered call on AEP at strike $67.50 using 300 shares is offering an income potential of $75. In July, a strike 67.50 covered call offers $240 and in August, a strike 67.50 covered call offers $420 in premium.

The annualized return by writing covered calls in June is 27.53%, in July is 13.46% and in August is 11.53%.

Chart for AEP


Telecommunications Focus: Income Opportunities

A July covered call on SBAC at strike $105.00 using 300 shares is offering an income potential of $285. In September, a strike 105.00 covered call offers $720 in premium.

The annualized return by writing covered calls in July is 10.53% and in September is 9.28%.

Chart for SBAC

A June covered call on VZ at strike $53.00 using 300 shares is offering an income potential of $78. In August, a strike 55.00 covered call offers $120 in premium.

The annualized return by writing covered calls in June is 36.28% and in August is 4.12%.

Chart for VZ

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

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