Income Alerts Newsletter for 12/26/2016

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 $120.50 for January 21 2017 are offering a 1.26% return, which annualizes at a rate of 17.74%.

Chart for QQQ

The DIA options at strike $199.50 for January 21 2017 are offering a 0.96% return, which annualizes at a rate of 13.53%.

Chart for DIA

The SPY options at strike $226.00 for January 21 2017 are offering a 1.08% return, which annualizes at a rate of 15.21%.

Chart for SPY


Technology Focus: Income Opportunities

A January covered call on AAPL at strike $117.00 using 300 shares is offering an income potential of $507. In February, a strike 120.00 covered call offers $651 and in March, a strike 120.00 covered call offers $855 in premium.

The annualized return by writing covered calls in January is 20.66%, in February is 12.83% and in March is 11.16%.

Chart for AAPL

A January covered call on GOOG at strike $790.00 using 300 shares is offering an income potential of $3,720. In February, a strike 790.00 covered call offers $8,310 and in March, a strike 790.00 covered call offers $9,630 in premium.

The annualized return by writing covered calls in January is 22.39%, in February is 24.56% and in March is 18.85%.

Chart for GOOG


Energy Focus: Income Opportunities

A January covered call on OXY at strike $72.50 using 300 shares is offering an income potential of $402. In February, a strike 72.50 covered call offers $711 and in May, a strike 72.50 covered call offers $1,110 in premium.

The annualized return by writing covered calls in January is 26.58%, in February is 22.97% and in May is 13.61%.

Chart for OXY

A January covered call on SLB at strike $86.00 using 300 shares is offering an income potential of $510. In February, a strike 87.50 covered call offers $546 and in May, a strike 87.50 covered call offers $1,110 in premium.

The annualized return by writing covered calls in January is 28.48%, in February is 14.70% and in May is 11.38%.

Chart for SLB


Healthcare Focus: Income Opportunities

A January covered call on PFE at strike $32.50 using 300 shares is offering an income potential of $168. In February, a strike 33.00 covered call offers $189 and in March, a strike 33.00 covered call offers $240 in premium.

The annualized return by writing covered calls in January is 22.08%, in February is 12.67% and in March is 10.84%.

Chart for PFE

A January covered call on JNJ at strike $116.00 using 300 shares is offering an income potential of $480. In February, a strike 120.00 covered call offers $318 and in March, a strike 120.00 covered call offers $405 in premium.

The annualized return by writing covered calls in January is 19.64%, in February is 6.24% and in March is 5.24%.

Chart for JNJ


Consumer Staples Focus: Income Opportunities

A January covered call on KO at strike $42.00 using 300 shares is offering an income potential of $114. In February, a strike 42.00 covered call offers $240 and in March, a strike 42.00 covered call offers $288 in premium.

The annualized return by writing covered calls in January is 11.60%, in February is 12.56% and in March is 10.14%.

Chart for KO

A January covered call on PM at strike $92.00 using 300 shares is offering an income potential of $393. In February, a strike 92.50 covered call offers $627 and in March, a strike 92.50 covered call offers $552 in premium.

The annualized return by writing covered calls in January is 18.27%, in February is 14.96% and in March is 8.80%.

Chart for PM


Consumer Discretionary Focus: Income Opportunities

A January covered call on CBS at strike $65.00 using 300 shares is offering an income potential of $405. In February, a strike 65.00 covered call offers $693 and in March, a strike 65.00 covered call offers $828 in premium.

The annualized return by writing covered calls in January is 29.93%, in February is 25.04% and in March is 19.84%.

Chart for CBS

A January covered call on CMCSA at strike $71.00 using 300 shares is offering an income potential of $390. In February, a strike 72.50 covered call offers $420 and in April, a strike 72.50 covered call offers $699 in premium.

The annualized return by writing covered calls in January is 22.34%, in February is 13.66% and in April is 10.64%.

Chart for CMCSA


Financials Focus: Income Opportunities

A January covered call on WFC at strike $56.00 using 300 shares is offering an income potential of $399. In February, a strike 57.50 covered call offers $378 and in March, a strike 57.50 covered call offers $501 in premium.

The annualized return by writing covered calls in January is 34.18%, in February is 15.57% and in March is 13.69%.

Chart for WFC

A January covered call on AXP at strike $75.00 using 300 shares is offering an income potential of $549. In February, a strike 75.00 covered call offers $777 and in April, a strike 75.00 covered call offers $1,140 in premium.

The annualized return by writing covered calls in January is 35.12%, in February is 24.19% and in April is 16.66%.

Chart for AXP


Industrials Focus: Income Opportunities

A January covered call on DHR at strike $80.00 using 300 shares is offering an income potential of $195. In February, a strike 80.00 covered call offers $435 and in March, a strike 80.00 covered call offers $540 in premium.

The annualized return by writing covered calls in January is 11.65%, in February is 12.65% and in March is 10.39%.

Chart for DHR

A January covered call on GE at strike $32.00 using 300 shares is offering an income potential of $150. In February, a strike 32.00 covered call offers $219 and in March, a strike 32.00 covered call offers $255 in premium.

The annualized return by writing covered calls in January is 22.37%, in February is 15.84% and in March is 12.19%.

Chart for GE


Materials Focus: Income Opportunities

A January covered call on NEM at strike $32.50 using 300 shares is offering an income potential of $420. In February, a strike 33.00 covered call offers $579 and in March, a strike 33.00 covered call offers $726 in premium.

The annualized return by writing covered calls in January is 56.73%, in February is 40.48% and in March is 34.59%.

Chart for NEM

A January covered call on LYB at strike $88.00 using 300 shares is offering an income potential of $570. In February, a strike 90.00 covered call offers $705 and in March, a strike 90.00 covered call offers $855 in premium.

The annualized return by writing covered calls in January is 31.09%, in February is 18.61% and in March is 14.95%.

Chart for LYB


Utilities Focus: Income Opportunities

A January covered call on D at strike $77.50 using 300 shares is offering an income potential of $240. In February, a strike 77.50 covered call offers $510 and in April, a strike 77.50 covered call offers $630 in premium.

The annualized return by writing covered calls in January is 14.79%, in February is 15.31% and in April is 8.78%.

Chart for D

A January covered call on DUK at strike $80.00 using 300 shares is offering an income potential of $120. In February, a strike 80.00 covered call offers $270 and in April, a strike 80.00 covered call offers $495 in premium.

The annualized return by writing covered calls in January is 6.52%, in February is 7.51% and in April is 6.61%.

Chart for DUK


Telecommunications Focus: Income Opportunities

A January covered call on CTL at strike $25.00 using 300 shares is offering an income potential of $75. In February, a strike 25.00 covered call offers $195 and in April, a strike 25.00 covered call offers $270 in premium.

The annualized return by writing covered calls in January is 14.74%, in February is 18.77% and in April is 12.12%.

Chart for CTL

A January covered call on SBAC at strike $105.00 using 300 shares is offering an income potential of $630. In February, a strike 105.00 covered call offers $1,020 and in March, a strike 105.00 covered call offers $1,380 in premium.

The annualized return by writing covered calls in January is 28.69%, in February is 22.66% and in March is 20.43%.

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.