Income Alerts Newsletter for 09/01/2016

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 $116.50 for September 23 2016 are offering a 1.24% return, which annualizes at a rate of 19.73%.

Chart for QQQ

The DIA options at strike $184.00 for September 23 2016 are offering a 1.01% return, which annualizes at a rate of 16.04%.

Chart for DIA

The SPY options at strike $217.50 for September 21 2016 are offering a 0.89% return, which annualizes at a rate of 15.49%.

Chart for SPY


Technology Focus: Income Opportunities

A September covered call on QCOM at strike $63.50 using 300 shares is offering an income potential of $183. In October, a strike 65.00 covered call offers $264 and in November, a strike 65.00 covered call offers $531 in premium.

The annualized return by writing covered calls in September is 20.97%, in October is 9.93% and in November is 13.17%.

Chart for QCOM

A September covered call on AAPL at strike $107.00 using 300 shares is offering an income potential of $429. In October, a strike 110.00 covered call offers $462 and in November, a strike 110.00 covered call offers $780 in premium.

The annualized return by writing covered calls in September is 29.33%, in October is 10.34% and in November is 11.46%.

Chart for AAPL


Energy Focus: Income Opportunities

A September covered call on EOG at strike $88.50 using 300 shares is offering an income potential of $546. In October, a strike 90.00 covered call offers $798 and in January, a strike 90.00 covered call offers $1,650 in premium.

The annualized return by writing covered calls in September is 45.09%, in October is 21.75% and in January is 16.92%.

Chart for EOG

A September covered call on OXY at strike $77.00 using 300 shares is offering an income potential of $219. In October, a strike 77.50 covered call offers $408 and in November, a strike 77.50 covered call offers $618 in premium.

The annualized return by writing covered calls in September is 20.59%, in October is 12.65% and in November is 12.57%.

Chart for OXY


Healthcare Focus: Income Opportunities

A September covered call on MRK at strike $63.00 using 300 shares is offering an income potential of $189. In October, a strike 65.00 covered call offers $144 and in November, a strike 65.00 covered call offers $276 in premium.

The annualized return by writing covered calls in September is 21.76%, in October is 5.41% and in November is 6.78%.

Chart for MRK


Consumer Staples Focus: Income Opportunities

A September covered call on ADM at strike $44.00 using 300 shares is offering an income potential of $150. In October, a strike 44.00 covered call offers $336 and in December, a strike 44.00 covered call offers $582 in premium.

The annualized return by writing covered calls in September is 24.82%, in October is 18.44% and in December is 15.68%.

Chart for ADM

A September covered call on PM at strike $100.00 using 300 shares is offering an income potential of $303. In October, a strike 100.00 covered call offers $552 and in December, a strike 100.00 covered call offers $864 in premium.

The annualized return by writing covered calls in September is 21.92%, in October is 13.17% and in December is 10.03%.

Chart for PM


Consumer Discretionary Focus: Income Opportunities

A September covered call on GM at strike $32.00 using 300 shares is offering an income potential of $111. In October, a strike 32.00 covered call offers $249 and in December, a strike 32.00 covered call offers $387 in premium.

The annualized return by writing covered calls in September is 25.18%, in October is 18.74% and in December is 14.23%.

Chart for GM

A September covered call on AMZN at strike $770.00 using 300 shares is offering an income potential of $2,805. In October, a strike 770.00 covered call offers $6,420 and in November, a strike 770.00 covered call offers $11,565 in premium.

The annualized return by writing covered calls in September is 26.42%, in October is 20.09% and in November is 24.07%.

Chart for AMZN


Financials Focus: Income Opportunities

A September covered call on MET at strike $43.50 using 300 shares is offering an income potential of $228. In October, a strike 45.00 covered call offers $240 and in November, a strike 45.00 covered call offers $336 in premium.

The annualized return by writing covered calls in September is 38.27%, in October is 13.18% and in November is 12.09%.

Chart for MET

A September covered call on MS at strike $32.50 using 300 shares is offering an income potential of $114. In October, a strike 33.00 covered call offers $228 and in November, a strike 33.00 covered call offers $291 in premium.

The annualized return by writing covered calls in September is 25.75%, in October is 17.04% and in November is 14.23%.

Chart for MS


Industrials Focus: Income Opportunities

A September covered call on HTZ at strike $50.00 using 300 shares is offering an income potential of $285. In October, a strike 50.00 covered call offers $705 and in January, a strike 50.00 covered call offers $1,950 in premium.

The annualized return by writing covered calls in September is 42.22%, in October is 35.16% and in January is 38.80%.

Chart for HTZ

A September covered call on UNP at strike $96.00 using 300 shares is offering an income potential of $339. In October, a strike 97.50 covered call offers $600 and in November, a strike 97.50 covered call offers $795 in premium.

The annualized return by writing covered calls in September is 25.70%, in October is 15.01% and in November is 13.02%.

Chart for UNP


Materials Focus: Income Opportunities

A September covered call on CF at strike $26.50 using 300 shares is offering an income potential of $213. In October, a strike 30.00 covered call offers $132 and in November, a strike 30.00 covered call offers $255 in premium.

The annualized return by writing covered calls in September is 60.28%, in October is 12.08% and in November is 15.42%.

Chart for CF

A September covered call on DOW at strike $54.00 using 300 shares is offering an income potential of $186. In October, a strike 55.00 covered call offers $219 and in December, a strike 55.00 covered call offers $507 in premium.

The annualized return by writing covered calls in September is 25.11%, in October is 9.68% and in December is 10.99%.

Chart for DOW


Telecommunications Focus: Income Opportunities

A September covered call on SBAC at strike $115.00 using 300 shares is offering an income potential of $315. In October, a strike 115.00 covered call offers $795 and in December, a strike 115.00 covered call offers $1,440 in premium.

The annualized return by writing covered calls in September is 19.93%, in October is 16.68% and in December is 14.84%.

Chart for SBAC

A September covered call on TMUS at strike $46.50 using 300 shares is offering an income potential of $231. In October, a strike 47.00 covered call offers $384 and in November, a strike 47.00 covered call offers $573 in premium.

The annualized return by writing covered calls in September is 36.28%, in October is 19.94% and in November is 19.61%.

Chart for TMUS

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

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