Income Alerts Newsletter for 10/20/2016

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 November 11 2016 are offering a 1.42% return, which annualizes at a rate of 22.53%.

Chart for QQQ

The DIA options at strike $182.50 for November 11 2016 are offering a 1.10% return, which annualizes at a rate of 17.45%.

Chart for DIA


Technology Focus: Income Opportunities

An October covered call on QCOM at strike $66.00 using 300 shares is offering an income potential of $102. In November, a strike 67.50 covered call offers $483 and in December, a strike 67.50 covered call offers $582 in premium.

The annualized return by writing covered calls in October is 63.20%, in November is 29.54% and in December is 18.80%.

Chart for QCOM

An October covered call on GOOG at strike $802.50 using 300 shares is offering an income potential of $1,020. In November, a strike 805.00 covered call offers $7,350 and in December, a strike 805.00 covered call offers $8,550 in premium.

The annualized return by writing covered calls in October is 51.83%, in November is 37.12% and in December is 22.81%.

Chart for GOOG


Energy Focus: Income Opportunities

An October covered call on OXY at strike $75.00 using 300 shares is offering an income potential of $87. In November, a strike 75.00 covered call offers $525 and in December, a strike 75.00 covered call offers $687 in premium.

The annualized return by writing covered calls in October is 47.54%, in November is 28.32% and in December is 19.62%.

Chart for OXY

An October covered call on HAL at strike $49.50 using 300 shares is offering an income potential of $75. In November, a strike 50.00 covered call offers $345 and in December, a strike 50.00 covered call offers $525 in premium.

The annualized return by writing covered calls in October is 62.30%, in November is 28.26% and in December is 22.88%.

Chart for HAL


Healthcare Focus: Income Opportunities

An October covered call on ESRX at strike $70.50 using 300 shares is offering an income potential of $117. In November, a strike 72.50 covered call offers $318 and in December, a strike 72.50 covered call offers $510 in premium.

The annualized return by writing covered calls in October is 67.75%, in November is 17.99% and in December is 15.30%.

Chart for ESRX

An October covered call on HCA at strike $82.00 using 300 shares is offering an income potential of $150. In November, a strike 82.50 covered call offers $645 and in December, a strike 82.50 covered call offers $840 in premium.

The annualized return by writing covered calls in October is 74.80%, in November is 31.77% and in December is 21.92%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

A November covered call on KO at strike $43.00 using 300 shares is offering an income potential of $108. In December, a strike 43.00 covered call offers $141 in premium.

The annualized return by writing covered calls in November is 10.17% and in December is 6.99%.

Chart for KO

A November covered call on STZ at strike $170.00 using 300 shares is offering an income potential of $600. In January, a strike 170.00 covered call offers $1,620 in premium.

The annualized return by writing covered calls in November is 14.24% and in January is 12.95%.

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 26.00 covered call offers $90 and in January, a strike 26.00 covered call offers $225 in premium.

The annualized return by writing covered calls in October is 147.06%, in November is 14.23% and in January is 11.95%.

Chart for FOXA

A November covered call on GM at strike $32.00 using 300 shares is offering an income potential of $276. In December, a strike 32.00 covered call offers $351 in premium.

The annualized return by writing covered calls in November is 35.02% and in December is 23.59%.

Chart for GM


Financials Focus: Income Opportunities

An October covered call on BAC at strike $21.00 using 300 shares is offering an income potential of $78. In December, a strike 17.00 covered call offers $111 in premium.

The annualized return by writing covered calls in October is 195.15% and in December is 14.22%.

Chart for BAC

An October covered call on GS at strike $175.00 using 300 shares is offering an income potential of $207. In November, a strike 175.00 covered call offers $1,095 and in December, a strike 175.00 covered call offers $1,560 in premium.

The annualized return by writing covered calls in October is 48.30%, in November is 25.15% and in December is 19.00%.

Chart for GS


Industrials Focus: Income Opportunities

An October covered call on UNP at strike $97.50 using 300 shares is offering an income potential of $363. In November, a strike 97.50 covered call offers $681 and in December, a strike 97.50 covered call offers $849 in premium.

The annualized return by writing covered calls in October is 153.49%, in November is 28.18% and in December is 18.57%.

Chart for UNP

An October covered call on BA at strike $137.00 using 300 shares is offering an income potential of $111. In November, a strike 140.00 covered call offers $447 and in December, a strike 140.00 covered call offers $690 in premium.

The annualized return by writing covered calls in October is 33.15%, in November is 13.03% and in December is 10.63%.

Chart for BA


Materials Focus: Income Opportunities

An October covered call on NEM at strike $37.00 using 300 shares is offering an income potential of $126. In November, a strike 37.00 covered call offers $540 and in December, a strike 37.00 covered call offers $726 in premium.

The annualized return by writing covered calls in October is 139.77%, in November is 60.24% and in December is 43.32%.

Chart for NEM

A November covered call on CF at strike $25.00 using 300 shares is offering an income potential of $261. In January, a strike 25.00 covered call offers $450 in premium.

The annualized return by writing covered calls in November is 44.00% and in January is 25.72%.

Chart for CF


Utilities Focus: Income Opportunities

A November covered call on CNP at strike $23.00 using 300 shares is offering an income potential of $105. In January, a strike 23.00 covered call offers $180 in premium.

The annualized return by writing covered calls in November is 18.50% and in January is 10.58%.

Chart for CNP

An October covered call on NEE at strike $125.00 using 300 shares is offering an income potential of $120. In November, a strike 125.00 covered call offers $735 and in December, a strike 125.00 covered call offers $900 in premium.

The annualized return by writing covered calls in October is 39.19%, in November is 23.62% and in December is 15.27%.

Chart for NEE


Telecommunications Focus: Income Opportunities

A November covered call on SBAC at strike $115.00 using 300 shares is offering an income potential of $555. In December, a strike 115.00 covered call offers $825 in premium.

The annualized return by writing covered calls in November is 19.77% and in December is 15.57%.

Chart for SBAC

A November covered call on CTL at strike $29.00 using 300 shares is offering an income potential of $165. In January, a strike 29.00 covered call offers $255 in premium.

The annualized return by writing covered calls in November is 23.44% and in January is 12.08%.

Chart for CTL

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

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