Income Alerts Newsletter for 12/30/2016

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 $120.00 for January 21 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for QQQ

The DIA options at strike $198.00 for January 21 2017 are offering a 0.00% return, which annualizes at a rate of 0.00%.

Chart for DIA

The SPY options at strike $224.50 for January 18 2017 are offering a 0.99% return, which annualizes at a rate of 18.07%.

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 $663 and in March, a strike 120.00 covered call offers $870 in premium.

The annualized return by writing covered calls in January is 23.31%, in February is 13.81% and in March is 11.77%.

Chart for AAPL

A January covered call on GOOG at strike $785.00 using 300 shares is offering an income potential of $3,240. In February, a strike 785.00 covered call offers $7,950 and in March, a strike 785.00 covered call offers $9,000 in premium.

The annualized return by writing covered calls in January is 22.20%, in February is 25.08% and in March is 18.41%.

Chart for GOOG


Energy Focus: Income Opportunities

A January covered call on APC at strike $70.50 using 300 shares is offering an income potential of $525. In February, a strike 72.50 covered call offers $699 and in May, a strike 72.50 covered call offers $1,440 in premium.

The annualized return by writing covered calls in January is 40.63%, in February is 24.60% and in May is 18.89%.

Chart for APC

A January covered call on EOG at strike $113.00 using 300 shares is offering an income potential of $84. In April, a strike 130.00 covered call offers $72 in premium.

The annualized return by writing covered calls in January is 4.60% and in April is 0.77%.

Chart for EOG


Healthcare Focus: Income Opportunities

A January covered call on HCA at strike $76.00 using 300 shares is offering an income potential of $375. In March, a strike 100.00 covered call offers $180 in premium.

The annualized return by writing covered calls in January is 28.55% and in March is 3.83%.

Chart for HCA

A January covered call on JNJ at strike $116.00 using 300 shares is offering an income potential of $357. In February, a strike 120.00 covered call offers $243 and in March, a strike 120.00 covered call offers $348 in premium.

The annualized return by writing covered calls in January is 16.52%, in February is 5.05% and in March is 4.69%.

Chart for JNJ


Consumer Staples Focus: Income Opportunities

A February covered call on ADM at strike $49.00 using 300 shares is offering an income potential of $174.

The annualized return by writing covered calls in February is 9.46%.

Chart for ADM

A January covered call on PEP at strike $105.00 using 300 shares is offering an income potential of $393. In February, a strike 105.00 covered call offers $708 and in April, a strike 105.00 covered call offers $1,005 in premium.

The annualized return by writing covered calls in January is 20.05%, in February is 16.46% and in April is 10.55%.

Chart for PEP


Consumer Discretionary Focus: Income Opportunities

A January covered call on CMCSA at strike $70.50 using 300 shares is offering an income potential of $297.

The annualized return by writing covered calls in January is 22.74%.

Chart for CMCSA

A January covered call on FOXA at strike $29.50 using 300 shares is offering an income potential of $75. In April, a strike 32.00 covered call offers $75 in premium.

The annualized return by writing covered calls in January is 14.80% and in April is 2.88%.

Chart for FOXA


Financials Focus: Income Opportunities

A January covered call on BAC at strike $22.50 using 300 shares is offering an income potential of $129. In February, a strike 23.00 covered call offers $168 and in March, a strike 23.00 covered call offers $231 in premium.

The annualized return by writing covered calls in January is 31.64%, in February is 18.69% and in March is 16.76%.

Chart for BAC

A January covered call on MS at strike $42.50 using 300 shares is offering an income potential of $306. In February, a strike 43.00 covered call offers $405 and in March, a strike 43.00 covered call offers $525 in premium.

The annualized return by writing covered calls in January is 39.36%, in February is 23.68% and in March is 20.01%.

Chart for MS


Industrials Focus: Income Opportunities

A January covered call on UNP at strike $109.00 using 300 shares is offering an income potential of $384. In February, a strike 120.00 covered call offers $72 in premium.

The annualized return by writing covered calls in January is 20.59% and in February is 1.68%.

Chart for UNP

A January covered call on UTX at strike $117.00 using 300 shares is offering an income potential of $72.

The annualized return by writing covered calls in January is 3.61%.

Chart for UTX


Materials Focus: Income Opportunities

A March covered call on NEM at strike $39.00 using 300 shares is offering an income potential of $378.

The annualized return by writing covered calls in March is 17.34%.

Chart for NEM

A January covered call on CF at strike $32.00 using 300 shares is offering an income potential of $381. In February, a strike 35.00 covered call offers $318 and in March, a strike 35.00 covered call offers $423 in premium.

The annualized return by writing covered calls in January is 65.80%, in February is 24.60% and in March is 21.37%.

Chart for CF


Utilities Focus: Income Opportunities

A May covered call on ED at strike $82.50 using 300 shares is offering an income potential of $135.

The annualized return by writing covered calls in May is 1.58%.

Chart for ED

A January covered call on NEE at strike $125.00 using 300 shares is offering an income potential of $105. In February, a strike 125.00 covered call offers $360 and in March, a strike 125.00 covered call offers $495 in premium.

The annualized return by writing covered calls in January is 4.64%, in February is 7.22% and in March is 6.43%.

Chart for NEE


Telecommunications Focus: Income Opportunities

A January covered call on SBAC at strike $115.00 using 300 shares is offering an income potential of $105. In February, a strike 110.00 covered call offers $450 and in March, a strike 105.00 covered call offers $1,380 in premium.

The annualized return by writing covered calls in January is 5.61%, in February is 10.69% and in March is 21.67%.

Chart for SBAC

A January covered call on LVLT at strike $57.50 using 300 shares is offering an income potential of $210. In February, a strike 57.50 covered call offers $480 and in March, a strike 57.50 covered call offers $570 in premium.

The annualized return by writing covered calls in January is 19.79%, in February is 20.73% and in March is 15.98%.

Chart for LVLT

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

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