Income Alerts Newsletter for 09/16/2016

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 October 7 2016 are offering a 1.13% return, which annualizes at a rate of 18.83%.

Chart for QQQ


Technology Focus: Income Opportunities

An October covered call on QCOM at strike $65.00 using 300 shares is offering an income potential of $189. In November, a strike 65.00 covered call offers $474 in premium.

The annualized return by writing covered calls in October is 10.04% and in November is 14.55%.

Chart for QCOM

A September covered call on BABA at strike $105.00 using 300 shares is offering an income potential of $117. In October, a strike 105.00 covered call offers $990 and in November, a strike 105.00 covered call offers $975 in premium.

The annualized return by writing covered calls in September is 68.40%, in October is 32.18% and in November is 18.03%.

Chart for BABA


Energy Focus: Income Opportunities

A September covered call on APC at strike $57.00 using 300 shares is offering an income potential of $123. In October, a strike 57.50 covered call offers $684 and in November, a strike 57.50 covered call offers $960 in premium.

The annualized return by writing covered calls in September is 132.39%, in October is 41.16% and in November is 33.44%.

Chart for APC

A September covered call on EOG at strike $91.00 using 300 shares is offering an income potential of $162. In October, a strike 92.50 covered call offers $705 and in January, a strike 92.50 covered call offers $1,665 in premium.

The annualized return by writing covered calls in September is 109.00%, in October is 26.17% and in January is 18.53%.

Chart for EOG


Healthcare Focus: Income Opportunities

A September covered call on GILD at strike $79.00 using 300 shares is offering an income potential of $78. In October, a strike 80.00 covered call offers $483 and in November, a strike 80.00 covered call offers $900 in premium.

The annualized return by writing covered calls in September is 60.38%, in October is 20.57% and in November is 22.21%.

Chart for GILD

An October covered call on MRK at strike $62.50 using 300 shares is offering an income potential of $396. In November, a strike 62.50 covered call offers $576 in premium.

The annualized return by writing covered calls in October is 21.33% and in November is 17.83%.

Chart for MRK


Consumer Staples Focus: Income Opportunities

An October covered call on STZ at strike $170.00 using 300 shares is offering an income potential of $810. In January, a strike 170.00 covered call offers $1,950 in premium.

The annualized return by writing covered calls in October is 16.26% and in January is 11.59%.

Chart for STZ

An October covered call on PG at strike $90.00 using 300 shares is offering an income potential of $234. In November, a strike 90.00 covered call offers $354 in premium.

The annualized return by writing covered calls in October is 8.82% and in November is 7.63%.

Chart for PG


Consumer Discretionary Focus: Income Opportunities

An October covered call on CBS at strike $52.50 using 300 shares is offering an income potential of $417. In December, a strike 52.50 covered call offers $753 in premium.

The annualized return by writing covered calls in October is 26.97% and in December is 19.81%.

Chart for CBS

An October covered call on CMCSA at strike $67.50 using 300 shares is offering an income potential of $192. In January, a strike 67.50 covered call offers $639 in premium.

The annualized return by writing covered calls in October is 9.62% and in January is 9.47%.

Chart for CMCSA


Financials Focus: Income Opportunities

An October covered call on BAC at strike $16.00 using 300 shares is offering an income potential of $114. In November, a strike 16.00 covered call offers $168 in premium.

The annualized return by writing covered calls in October is 24.52% and in November is 20.81%.

Chart for BAC

An October covered call on GS at strike $170.00 using 300 shares is offering an income potential of $1,095. In January, a strike 170.00 covered call offers $2,370 in premium.

The annualized return by writing covered calls in October is 21.90% and in January is 14.06%.

Chart for GS


Industrials Focus: Income Opportunities

An October covered call on HTZ at strike $50.00 using 300 shares is offering an income potential of $390. In January, a strike 50.00 covered call offers $1,170 in premium.

The annualized return by writing covered calls in October is 27.44% and in January is 25.20%.

Chart for HTZ


Utilities Focus: Income Opportunities

A November covered call on AES at strike $13.00 using 300 shares is offering an income potential of $90.

The annualized return by writing covered calls in November is 13.75%.

Chart for AES


Telecommunications Focus: Income Opportunities

An October covered call on TMUS at strike $48.00 using 300 shares is offering an income potential of $330. In November, a strike 48.00 covered call offers $519 in premium.

The annualized return by writing covered calls in October is 23.55% and in November is 21.37%.

Chart for TMUS

An October covered call on S at strike $7.00 using 300 shares is offering an income potential of $105. In November, a strike 7.00 covered call offers $177 in premium.

The annualized return by writing covered calls in October is 53.61% and in November is 53.44%.

Chart for S

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

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