covered call screen 17, Covered Call Screen For The Holidays

Want some extra cash for the holidays? Here's a covered call screen that identifies some candidates for the December cycle (30 days to expiration from today). You could buy these stocks, write covered calls against them, and then use the cash to pay for your parties and gift-giving. Party on.

Q4 Screen For Covered Calls

Let's create a few holiday-themed sectors and put in some candidate companies within each that people should be attracted to while shopping and partying:

Sector Candidate Stocks
Food ADM, CMG, HSY, SBUX
Drink BF.B, BEAM, DEO, KO
Tobacco BTI, MO, RAI, UVV
Toys AAPL, HAS, LF, MAT
Bling GLD, NILE, TIF, SIG

It's not clear if AAPL should be in Bling or Toys but we'll leave it in Toys for now.

From each sector we enter the symbols into Born To Sell's Watchlist to create a screen based on high yielding, in the money covered calls, resulting in these candidates:

Sector Symbol Stock
Price
Sell Calls Annualized Return
If Flat
Food CMG 315.07 Dec 300 for 21.50 26.8%
Food SBUX 42.07 Dec 40 for 3.05 30.4%
Drink KO 66.80 Dec 65 for 2.39 19.5%
Tobacco MO 27.64 Dec 27 for 0.96 14.6%
Tobacco RAI 40.40 Dec 40 for 0.95 17.0%
Toys AAPL 378.25 Dec 365 for 22.10 30.4%
Toys MAT 27.74 Dec 26 for 1.90 18.2%
Bling GLD 167.10 Dec 164 for 6.60 25.5%
Bling NILE 32.14 Dec 30 for 3.30 48.7%
Bling TIF 75.28 Dec 70 for 7.30 36.5%

This is by no means a recommendation to automatically go put on those trades. Additional diligence on those companies is required. But it is an example of how you can do a themed covered call screen. There is a bit of work to think about what categories you want to invest in for the next cycle, and then come up with a few symbols that fit into each one.

Then it's a matter of screening for the ones that pay the best to create some covered call candidates. And, finally, begin due diligence on the ones that filter to the top of the list. For example, from the above list there is one that has earnings before the December expiration (TIF) which may be reason enough to remove it from the list (or at least cause you to write deeper in the money than you normally would).

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