Income Alerts Newsletter for 12/15/2016

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 $120.50 for January 6 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for QQQ

The DIA options at strike $198.50 for January 6 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for DIA

The SPY options at strike $227.00 for January 4 2017 are offering a 0.68% return, which annualizes at a rate of 11.74%.

Chart for SPY


Technology Focus: Income Opportunities

A December covered call on AAPL at strike $116.00 using 300 shares is offering an income potential of $183. In January, a strike 120.00 covered call offers $336 and in February, a strike 120.00 covered call offers $720 in premium.

The annualized return by writing covered calls in December is 64.35%, in January is 9.37% and in February is 11.69%.

Chart for AAPL

A December covered call on FB at strike $121.00 using 300 shares is offering an income potential of $267. In January, a strike 125.00 covered call offers $456 and in February, a strike 125.00 covered call offers $1,140 in premium.

The annualized return by writing covered calls in December is 90.20%, in January is 12.23% and in February is 17.94%.

Chart for FB


Energy Focus: Income Opportunities

A January covered call on HES at strike $92.50 using 300 shares is offering an income potential of $141.

The annualized return by writing covered calls in January is 7.42%.

Chart for HES

A January covered call on OXY at strike $97.50 using 300 shares is offering an income potential of $600.

The annualized return by writing covered calls in January is 26.30%.

Chart for OXY


Healthcare Focus: Income Opportunities

A December covered call on GILD at strike $76.00 using 300 shares is offering an income potential of $171. In January, a strike 77.50 covered call offers $504 and in February, a strike 77.50 covered call offers $864 in premium.

The annualized return by writing covered calls in December is 92.02%, in January is 21.73% and in February is 21.80%.

Chart for GILD

A December covered call on HCA at strike $73.50 using 300 shares is offering an income potential of $255. In January, a strike 75.00 covered call offers $555 and in March, a strike 75.00 covered call offers $990 in premium.

The annualized return by writing covered calls in December is 142.80%, in January is 24.88% and in March is 18.31%.

Chart for HCA


Consumer Staples Focus: Income Opportunities

A March covered call on PM at strike $92.50 using 300 shares is offering an income potential of $552.

The annualized return by writing covered calls in March is 8.13%.

Chart for PM

A December covered call on CVS at strike $79.50 using 300 shares is offering an income potential of $285. In January, a strike 80.00 covered call offers $492 and in February, a strike 80.00 covered call offers $783 in premium.

The annualized return by writing covered calls in December is 147.84%, in January is 20.33% and in February is 18.86%.

Chart for CVS


Consumer Discretionary Focus: Income Opportunities

A January covered call on FOXA at strike $36.00 using 300 shares is offering an income potential of $90. In April, a strike 31.00 covered call offers $150 in premium.

The annualized return by writing covered calls in January is 10.68% and in April is 5.18%.

Chart for FOXA

A December covered call on AMZN at strike $852.50 using 300 shares is offering an income potential of $294. In January, a strike 895.00 covered call offers $189 and in February, a strike 945.00 covered call offers $603 in premium.

The annualized return by writing covered calls in December is 23.29%, in January is 0.81% and in February is 1.47%.

Chart for AMZN


Financials Focus: Income Opportunities

A December covered call on AXP at strike $74.50 using 300 shares is offering an income potential of $117. In January, a strike 75.00 covered call offers $519 and in April, a strike 75.00 covered call offers $1,125 in premium.

The annualized return by writing covered calls in December is 64.17%, in January is 22.89% and in April is 15.03%.

Chart for AXP

A December covered call on JPM at strike $86.00 using 300 shares is offering an income potential of $105. In January, a strike 87.50 covered call offers $420 and in February, a strike 87.50 covered call offers $633 in premium.

The annualized return by writing covered calls in December is 50.21%, in January is 16.05% and in February is 14.05%.

Chart for JPM


Industrials Focus: Income Opportunities

A December covered call on UPS at strike $118.00 using 300 shares is offering an income potential of $240. In January, a strike 120.00 covered call offers $450 and in April, a strike 120.00 covered call offers $975 in premium.

The annualized return by writing covered calls in December is 83.66%, in January is 12.46% and in April is 8.07%.

Chart for UPS

A December covered call on DHR at strike $92.50 using 300 shares is offering an income potential of $2,820. In January, a strike 80.00 covered call offers $315 and in March, a strike 80.00 covered call offers $615 in premium.

The annualized return by writing covered calls in December is 1,643.20%, in January is 12.94% and in March is 10.34%.

Chart for DHR


Materials Focus: Income Opportunities

A January covered call on MON at strike $105.00 using 300 shares is offering an income potential of $390. In April, a strike 105.00 covered call offers $1,125 in premium.

The annualized return by writing covered calls in January is 12.09% and in April is 10.53%.

Chart for MON

A December covered call on LYB at strike $90.00 using 300 shares is offering an income potential of $105. In January, a strike 90.00 covered call offers $660 and in March, a strike 90.00 covered call offers $1,020 in premium.

The annualized return by writing covered calls in December is 48.48%, in January is 24.57% and in March is 15.57%.

Chart for LYB


Utilities Focus: Income Opportunities

A December covered call on D at strike $75.00 using 300 shares is offering an income potential of $75. In January, a strike 75.00 covered call offers $435 and in April, a strike 75.00 covered call offers $795 in premium.

The annualized return by writing covered calls in December is 40.88%, in January is 19.03% and in April is 10.41%.

Chart for D

A December covered call on DUK at strike $77.50 using 300 shares is offering an income potential of $150. In January, a strike 77.50 covered call offers $495 and in April, a strike 77.50 covered call offers $705 in premium.

The annualized return by writing covered calls in December is 80.73%, in January is 21.36% and in April is 9.05%.

Chart for DUK


Telecommunications Focus: Income Opportunities

A January covered call on VOD at strike $39.00 using 300 shares is offering an income potential of $96.

The annualized return by writing covered calls in January is 12.73%.

Chart for VOD

A January covered call on SBAC at strike $105.00 using 300 shares is offering an income potential of $450. In March, a strike 105.00 covered call offers $1,110 in premium.

The annualized return by writing covered calls in January is 14.34% and in March is 14.62%.

Chart for SBAC

* 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.