Income Alerts Newsletter for 10/18/2016

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 $117.00 for November 11 2016 are offering a 1.67% return, which annualizes at a rate of 24.40%.

Chart for QQQ


Technology Focus: Income Opportunities

An October covered call on QCOM at strike $65.50 using 300 shares is offering an income potential of $144. In November, a strike 67.50 covered call offers $429 and in December, a strike 67.50 covered call offers $540 in premium.

The annualized return by writing covered calls in October is 54.15%, in November is 24.81% and in December is 16.99%.

Chart for QCOM

An October covered call on BABA at strike $103.00 using 300 shares is offering an income potential of $378. In November, a strike 105.00 covered call offers $1,200 and in January, a strike 105.00 covered call offers $1,770 in premium.

The annualized return by writing covered calls in October is 90.55%, in November is 44.76% and in January is 23.14%.

Chart for BABA


Energy Focus: Income Opportunities

An October covered call on SLB at strike $81.00 using 300 shares is offering an income potential of $366. In November, a strike 82.50 covered call offers $468 and in December, a strike 82.50 covered call offers $627 in premium.

The annualized return by writing covered calls in October is 111.66%, in November is 21.73% and in December is 15.85%.

Chart for SLB

An October covered call on HAL at strike $46.50 using 300 shares is offering an income potential of $258. In November, a strike 47.00 covered call offers $441 and in December, a strike 47.00 covered call offers $588 in premium.

The annualized return by writing covered calls in October is 138.10%, in November is 36.25% and in December is 26.44%.

Chart for HAL


Healthcare Focus: Income Opportunities

An October covered call on HCA at strike $80.50 using 300 shares is offering an income potential of $255. In November, a strike 82.50 covered call offers $510 and in December, a strike 82.50 covered call offers $705 in premium.

The annualized return by writing covered calls in October is 78.01%, in November is 23.90% and in December is 18.02%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

An October covered call on PEP at strike $107.00 using 300 shares is offering an income potential of $138. In November, a strike 110.00 covered call offers $135 and in December, a strike 110.00 covered call offers $231 in premium.

The annualized return by writing covered calls in October is 31.56%, in November is 4.68% and in December is 4.34%.

Chart for PEP

An October covered call on STZ at strike $170.00 using 300 shares is offering an income potential of $75. In November, a strike 170.00 covered call offers $690 and in January, a strike 170.00 covered call offers $1,650 in premium.

The annualized return by writing covered calls in October is 10.94%, in November is 15.43% and in January is 12.94%.

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 $180 and in January, a strike 25.00 covered call offers $330 in premium.

The annualized return by writing covered calls in October is 89.83%, in November is 27.56% and in January is 17.74%.

Chart for FOXA

An October covered call on CBS at strike $55.50 using 300 shares is offering an income potential of $168. In November, a strike 57.50 covered call offers $261 and in December, a strike 57.50 covered call offers $381 in premium.

The annualized return by writing covered calls in October is 74.56%, in November is 17.65% and in December is 14.04%.

Chart for CBS


Financials Focus: Income Opportunities

An October covered call on MET at strike $47.00 using 300 shares is offering an income potential of $78. In November, a strike 47.50 covered call offers $291 and in December, a strike 47.50 covered call offers $402 in premium.

The annualized return by writing covered calls in October is 40.90%, in November is 23.48% and in December is 17.69%.

Chart for MET

An October covered call on MS at strike $32.00 using 300 shares is offering an income potential of $129. In November, a strike 32.00 covered call offers $273 and in December, a strike 32.00 covered call offers $387 in premium.

The annualized return by writing covered calls in October is 100.10%, in November is 32.59% and in December is 25.31%.

Chart for MS


Industrials Focus: Income Opportunities

An October covered call on BA at strike $135.00 using 300 shares is offering an income potential of $192. In November, a strike 135.00 covered call offers $873 and in December, a strike 135.00 covered call offers $1,125 in premium.

The annualized return by writing covered calls in October is 35.03%, in November is 24.55% and in December is 17.23%.

Chart for BA

A November covered call on HTZ at strike $35.00 using 300 shares is offering an income potential of $480. In January, a strike 35.00 covered call offers $780 in premium.

The annualized return by writing covered calls in November is 55.65% and in January is 32.10%.

Chart for HTZ


Materials Focus: Income Opportunities

A November covered call on DOW at strike $55.00 using 300 shares is offering an income potential of $174. In December, a strike 55.00 covered call offers $321 in premium.

The annualized return by writing covered calls in November is 12.24% and in December is 12.33%.

Chart for DOW

An October covered call on LYB at strike $80.00 using 300 shares is offering an income potential of $210. In November, a strike 80.00 covered call offers $765 and in December, a strike 80.00 covered call offers $900 in premium.

The annualized return by writing covered calls in October is 64.82%, in November is 36.64% and in December is 23.46%.

Chart for LYB


Utilities Focus: Income Opportunities

An October covered call on NEE at strike $125.00 using 300 shares is offering an income potential of $165. In November, a strike 125.00 covered call offers $690 and in December, a strike 125.00 covered call offers $885 in premium.

The annualized return by writing covered calls in October is 32.51%, in November is 20.89% and in December is 14.57%.

Chart for NEE


Telecommunications Focus: Income Opportunities

An October covered call on TMUS at strike $47.00 using 300 shares is offering an income potential of $81. In November, a strike 47.00 covered call offers $414 and in January, a strike 47.00 covered call offers $717 in premium.

The annualized return by writing covered calls in October is 42.62%, in November is 33.81% and in January is 20.59%.

Chart for TMUS

A November covered call on S at strike $7.00 using 300 shares is offering an income potential of $144. In December, a strike 7.00 covered call offers $183 in premium.

The annualized return by writing covered calls in November is 82.44% and in December is 57.84%.

Chart for S

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

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