The 15 Best Income Stocks For Options Traders In 2018
Companies with appreciation potential and substantial premiums on weekly put and call options; options that investors can SELL to generate weekly cash income. I’ve put my research and analysis together to identify the best 15 Income stocks to own and trade in 2018, and together, you can use these stocks for potential total annual income of 47% from your portfolio this year! I call them Income Dominators. I use a process perhaps different from most people in the investing marketplace.
I begin with Trends - consumer, business and manufacturing trends driving the market. Then I look for the best companies profiting from those trends. Let’s take a look at the top four trends which I believe will dominate the market in 2018, and the companies that are best positioned to capitalize on those trends.
I am a big believer in the ongoing growth in travel by Millenials and Boomers, a group which represents 170 million American consumers, alone. This group of consumers spends their money on “experiences” rather than hard goods - a trend which developed in 2012 and continues today. • An under-valued airline with consistent premiums available for options sellers that can return 36% in annual income. • A cruise line operator with a potential annual return on capital of 38% serving the growing market of fixed cost travel experience.
As you’ll discover, I believe we’re at the beginning of a massive “Super Cycle” in technology. That cycle means new products in tech and new products in tech means a long-term trend (up) in semiconductor and chip stocks. • The most unloved and misunderstood tech company which simply prints money quarter after quarter and gives conservative (yes, conservative) investors the potential for 25% return on capital this year, over and above any potential price appreciation.
• Another chipmaker with substantial upside from a proven company with strong fundamentals and a dominating market position (and no, it isn’t Intel). This company is a little more volatile in price swings, but traded appropriately offers an astounding 55% income potential. • A third chipmaker with memory chips at the heart of the Tech Super Cycle but prone to larger price swings based on rumors not news.
Still, at 41% annual return on capital, this one company should be an income investors go to stock for weekly income. • A wireless company rapidly gaining market share against its competitors with strong premiums available every week and on the leading edge of providing consumers wider and better service. This company can give you a 41% annual return on capital, but as with others, the volatility from time to time means higher premiums available.
I have three energy companies, all of which are less dependent upon the rise or fall in oil prices as they are self-contained companies or in alternative markets which continue to see growth. They can be more volatile week to week, but they must be considered by any investor or trader for the consistently strong premiums they offer. • This one company has been a go-to source of income trades for me for over three years and I see no reason to stop collecting the cash from one of the best independent refiners in the U.S.
Premiums on this company are generous from week to week, which results in a potential 38% annual return on capital. • An unusual company with a dominant market position in the U.S. • An alternative energy company which is very volatile and susceptible to headline selling but which offers potential return on capital of 47%. While I like this company for their fundamentals and market position, it does carry more risk.
Trade it carefully and you’ll be safe. It’s no secret that in 2017, retail stocks were one of the most unloved (hated,) sectors in the economy - and with good reason. Nearly every consumer retail stock is being measured against Amazon. If you look carefully, however, you can find stocks which are immune from the Amazon effect or are beating Amazon in their categories. • The “sure thing” automotive company which is finally getting the recognition it deserves for strong profit growth but which continues to trade at a discount to that growth.
