Income Alerts Newsletter for 10/06/2016

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 $119.00 for October 28 2016 are offering a 1.23% return, which annualizes at a rate of 19.47%.

Chart for QQQ

The DIA options at strike $183.00 for October 28 2016 are offering a 1.04% return, which annualizes at a rate of 16.50%.

Chart for DIA

The SPY options at strike $216.00 for October 26 2016 are offering a 0.99% return, which annualizes at a rate of 17.18%.

Chart for SPY


Technology Focus: Income Opportunities

An October covered call on QCOM at strike $67.00 using 300 shares is offering an income potential of $324. In November, a strike 67.50 covered call offers $705 and in December, a strike 67.50 covered call offers $774 in premium.

The annualized return by writing covered calls in October is 35.26%, in November is 29.56% and in December is 20.07%.

Chart for QCOM

An October covered call on AAPL at strike $114.00 using 300 shares is offering an income potential of $369. In November, a strike 115.00 covered call offers $882 and in December, a strike 115.00 covered call offers $1,050 in premium.

The annualized return by writing covered calls in October is 23.62%, in November is 21.66% and in December is 15.97%.

Chart for AAPL


Energy Focus: Income Opportunities

An October covered call on CVX at strike $103.00 using 300 shares is offering an income potential of $357. In November, a strike 105.00 covered call offers $459 and in December, a strike 105.00 covered call offers $561 in premium.

The annualized return by writing covered calls in October is 25.29%, in November is 12.32% and in December is 9.32%.

Chart for CVX

An October covered call on HES at strike $53.50 using 300 shares is offering an income potential of $501. In November, a strike 55.00 covered call offers $723 and in December, a strike 55.00 covered call offers $915 in premium.

The annualized return by writing covered calls in October is 69.21%, in November is 38.28% and in December is 30.24%.

Chart for HES


Healthcare Focus: Income Opportunities

An October covered call on JNJ at strike $120.00 using 300 shares is offering an income potential of $303. In November, a strike 120.00 covered call offers $519 and in December, a strike 120.00 covered call offers $660 in premium.

The annualized return by writing covered calls in October is 18.35%, in November is 11.95% and in December is 9.40%.

Chart for JNJ

An October covered call on MRK at strike $63.00 using 300 shares is offering an income potential of $348. In November, a strike 65.00 covered call offers $273 and in December, a strike 65.00 covered call offers $354 in premium.

The annualized return by writing covered calls in October is 40.41%, in November is 11.93% and in December is 9.57%.

Chart for MRK


Consumer Staples Focus: Income Opportunities

An October covered call on ADM at strike $43.50 using 300 shares is offering an income potential of $186. In November, a strike 44.00 covered call offers $315 and in December, a strike 44.00 covered call offers $387 in premium.

The annualized return by writing covered calls in October is 31.21%, in November is 20.17% and in December is 15.36%.

Chart for ADM

An October covered call on STZ at strike $170.00 using 300 shares is offering an income potential of $525. In November, a strike 170.00 covered call offers $1,050 and in January, a strike 170.00 covered call offers $2,010 in premium.

The annualized return by writing covered calls in October is 22.52%, in November is 17.19% and in January is 13.99%.

Chart for STZ


Consumer Discretionary Focus: Income Opportunities

An October covered call on FOXA at strike $34.00 using 300 shares is offering an income potential of $90. In November, a strike 25.00 covered call offers $195 and in January, a strike 25.00 covered call offers $330 in premium.

The annualized return by writing covered calls in October is 26.44%, in November is 21.96% and in January is 15.78%.

Chart for FOXA

An October covered call on CBS at strike $56.50 using 300 shares is offering an income potential of $285. In November, a strike 57.50 covered call offers $432 and in December, a strike 57.50 covered call offers $528 in premium.

The annualized return by writing covered calls in October is 36.78%, in November is 21.25% and in December is 16.10%.

Chart for CBS


Financials Focus: Income Opportunities

An October covered call on AXP at strike $64.50 using 300 shares is offering an income potential of $432. In November, a strike 65.00 covered call offers $516 and in December, a strike 65.00 covered call offers $648 in premium.

The annualized return by writing covered calls in October is 49.14%, in November is 22.27% and in December is 17.36%.

Chart for AXP

An October covered call on GS at strike $167.50 using 300 shares is offering an income potential of $900. In November, a strike 170.00 covered call offers $1,140 and in December, a strike 170.00 covered call offers $1,500 in premium.

The annualized return by writing covered calls in October is 39.42%, in November is 18.96% and in December is 15.49%.

Chart for GS


Industrials Focus: Income Opportunities

An October covered call on UPS at strike $110.00 using 300 shares is offering an income potential of $270. In November, a strike 110.00 covered call offers $549 and in December, a strike 110.00 covered call offers $669 in premium.

The annualized return by writing covered calls in October is 17.85%, in November is 13.83% and in December is 10.43%.

Chart for UPS

An October covered call on HTZ at strike $40.00 using 300 shares is offering an income potential of $300. In November, a strike 40.00 covered call offers $705 and in January, a strike 40.00 covered call offers $1,080 in premium.

The annualized return by writing covered calls in October is 55.99%, in November is 51.52% and in January is 34.03%.

Chart for HTZ


Materials Focus: Income Opportunities

An October covered call on DOW at strike $53.00 using 300 shares is offering an income potential of $195. In November, a strike 55.00 covered call offers $162 and in December, a strike 55.00 covered call offers $309 in premium.

The annualized return by writing covered calls in October is 26.81%, in November is 8.40% and in December is 9.97%.

Chart for DOW

An October covered call on FCX at strike $11.00 using 300 shares is offering an income potential of $93. In November, a strike 11.00 covered call offers $207 and in December, a strike 11.00 covered call offers $264 in premium.

The annualized return by writing covered calls in October is 64.25%, in November is 56.08% and in December is 44.94%.

Chart for FCX


Telecommunications Focus: Income Opportunities

An October covered call on TMUS at strike $46.50 using 300 shares is offering an income potential of $243. In November, a strike 47.00 covered call offers $438 and in January, a strike 47.00 covered call offers $726 in premium.

The annualized return by writing covered calls in October is 38.43%, in November is 26.55% and in January is 18.74%.

Chart for TMUS

A November covered call on S at strike $7.00 using 300 shares is offering an income potential of $123. In December, a strike 7.00 covered call offers $153 in premium.

The annualized return by writing covered calls in November is 53.21% and in December is 41.46%.

Chart for S

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

The information presented in this site is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. Nothing in our research constitutes legal, accounting or tax advice or individually tailored investment advice. Our research is prepared for general circulation and has been prepared without regard to the individual financial circumstances and objectives of persons who receive or obtain access to it. Our research is based on sources that we believe to be reliable. However, we do not make any representation or warranty, expressed or implied, as to the accuracy of our research, the completeness, or correctness or make any guarantee or other promise as to any results that may be obtained from using our research. To the maximum extent permitted by law, neither we, any of our affiliates, nor any other person, shall have any liability whatsoever to any person for any loss or expense, whether direct, indirect, consequential, incidental or otherwise, arising from or relating in any way to any use of or reliance on our research or the information contained therein. Some discussions contain forward looking statements which are based on current expectations and differences can be expected. All of our research, including the estimates, opinions and information contained therein, reflects our judgment as of the publication or other dissemination date of the research and is subject to change without notice. Further, we expressly disclaim any responsibility to update such research. Investing involves substantial risk. Past performance is not a guarantee of future results, and a loss of original capital may occur. No one receiving or accessing our research should make any investment decision without first consulting his or her own personal financial advisor and conducting his or her own research and due diligence, including carefully reviewing any applicable prospectuses, press releases, reports and other public filings of the issuer of any securities being considered. None of the information presented should be construed as an offer to sell or buy any particular security. As always, use your best judgment when investing.