Income Alerts Newsletter for 10/26/2016

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 $119.50 for November 19 2016 are offering a 1.28% return, which annualizes at a rate of 18.73%.

Chart for QQQ


Technology Focus: Income Opportunities

A November covered call on QCOM at strike $68.00 using 300 shares is offering an income potential of $645. In December, a strike 70.00 covered call offers $465 and in January, a strike 70.00 covered call offers $591 in premium.

The annualized return by writing covered calls in November is 47.88%, in December is 16.13% and in January is 12.43%.

Chart for QCOM

A November covered call on AAPL at strike $119.00 using 300 shares is offering an income potential of $801. In December, a strike 120.00 covered call offers $885 and in January, a strike 120.00 covered call offers $1,140 in premium.

The annualized return by writing covered calls in November is 33.73%, in December is 17.62% and in January is 13.77%.

Chart for AAPL


Energy Focus: Income Opportunities

A November covered call on OXY at strike $75.00 using 300 shares is offering an income potential of $432. In December, a strike 75.00 covered call offers $651 and in January, a strike 75.00 covered call offers $762 in premium.

The annualized return by writing covered calls in November is 28.80%, in December is 20.68% and in January is 14.65%.

Chart for OXY

A November covered call on SLB at strike $80.50 using 300 shares is offering an income potential of $450. In December, a strike 82.50 covered call offers $417 and in January, a strike 82.50 covered call offers $618 in premium.

The annualized return by writing covered calls in November is 27.82%, in December is 12.14% and in January is 10.93%.

Chart for SLB


Healthcare Focus: Income Opportunities

A November covered call on HCA at strike $82.00 using 300 shares is offering an income potential of $510. In December, a strike 82.50 covered call offers $660 and in January, a strike 82.50 covered call offers $900 in premium.

The annualized return by writing covered calls in November is 31.31%, in December is 19.24% and in January is 15.96%.

Chart for HCA

A November covered call on MRK at strike $62.00 using 300 shares is offering an income potential of $300. In December, a strike 62.50 covered call offers $357 and in January, a strike 62.50 covered call offers $474 in premium.

The annualized return by writing covered calls in November is 23.95%, in December is 13.49% and in January is 10.86%.

Chart for MRK


Consumer Staples Focus: Income Opportunities

A November covered call on KO at strike $43.00 using 300 shares is offering an income potential of $156. In December, a strike 43.00 covered call offers $189 and in January, a strike 43.00 covered call offers $225 in premium.

The annualized return by writing covered calls in November is 18.03%, in December is 10.33% and in January is 7.43%.

Chart for KO

A November covered call on ADM at strike $43.00 using 300 shares is offering an income potential of $237. In December, a strike 43.00 covered call offers $330 and in January, a strike 43.00 covered call offers $423 in premium.

The annualized return by writing covered calls in November is 27.63%, in December is 18.28% and in January is 14.22%.

Chart for ADM


Consumer Discretionary Focus: Income Opportunities

A November covered call on FOXA at strike $26.00 using 300 shares is offering an income potential of $150. In January, a strike 26.00 covered call offers $300 and in April, a strike 26.00 covered call offers $435 in premium.

The annualized return by writing covered calls in November is 29.13%, in January is 16.89% and in April is 12.26%.

Chart for FOXA

A November covered call on CBS at strike $56.00 using 300 shares is offering an income potential of $573. In December, a strike 57.50 covered call offers $387 and in January, a strike 57.50 covered call offers $546 in premium.

The annualized return by writing covered calls in November is 51.56%, in December is 16.24% and in January is 13.94%.

Chart for CBS


Financials Focus: Income Opportunities

A November covered call on WFC at strike $46.00 using 300 shares is offering an income potential of $156. In December, a strike 46.00 covered call offers $273 and in January, a strike 46.00 covered call offers $420 in premium.

The annualized return by writing covered calls in November is 16.80%, in December is 13.99% and in January is 13.10%.

Chart for WFC

A November covered call on AXP at strike $67.00 using 300 shares is offering an income potential of $360. In December, a strike 67.50 covered call offers $465 and in January, a strike 67.50 covered call offers $696 in premium.

The annualized return by writing covered calls in November is 26.73%, in December is 16.37% and in January is 14.94%.

Chart for AXP


Industrials Focus: Income Opportunities

A November covered call on UTX at strike $102.00 using 300 shares is offering an income potential of $363. In December, a strike 105.00 covered call offers $258 and in January, a strike 105.00 covered call offers $489 in premium.

The annualized return by writing covered calls in November is 17.64%, in December is 5.89% and in January is 6.78%.

Chart for UTX

A November covered call on DHR at strike $80.00 using 300 shares is offering an income potential of $210. In December, a strike 80.00 covered call offers $405 and in January, a strike 80.00 covered call offers $510 in premium.

The annualized return by writing covered calls in November is 13.09%, in December is 12.01% and in January is 9.15%.

Chart for DHR


Materials Focus: Income Opportunities

A November covered call on NEM at strike $37.00 using 300 shares is offering an income potential of $414. In December, a strike 37.00 covered call offers $600 and in January, a strike 37.00 covered call offers $816 in premium.

The annualized return by writing covered calls in November is 57.22%, in December is 39.82% and in January is 33.31%.

Chart for NEM

A November covered call on CF at strike $26.00 using 300 shares is offering an income potential of $297. In December, a strike 30.00 covered call offers $96 and in January, a strike 26.00 covered call offers $555 in premium.

The annualized return by writing covered calls in November is 58.88%, in December is 8.74% and in January is 32.39%.

Chart for CF


Utilities Focus: Income Opportunities

A November covered call on DUK at strike $80.00 using 300 shares is offering an income potential of $165. In December, a strike 80.00 covered call offers $300 and in January, a strike 80.00 covered call offers $435 in premium.

The annualized return by writing covered calls in November is 10.29%, in December is 8.88% and in January is 7.80%.

Chart for DUK

A November covered call on ED at strike $75.00 using 300 shares is offering an income potential of $180. In December, a strike 75.00 covered call offers $330 and in January, a strike 75.00 covered call offers $480 in premium.

The annualized return by writing covered calls in November is 11.99%, in December is 10.44% and in January is 9.21%.

Chart for ED


Telecommunications Focus: Income Opportunities

A November covered call on LVLT at strike $47.00 using 300 shares is offering an income potential of $510. In December, a strike 47.00 covered call offers $630 and in January, a strike 47.00 covered call offers $735 in premium.

The annualized return by writing covered calls in November is 54.91%, in December is 32.28% and in January is 22.86%.

Chart for LVLT

A November covered call on SBAC at strike $120.00 using 300 shares is offering an income potential of $315. In December, a strike 120.00 covered call offers $495 and in January, a strike 120.00 covered call offers $675 in premium.

The annualized return by writing covered calls in November is 13.44%, in December is 10.01% and in January is 8.27%.

Chart for SBAC

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

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