Healthcare
JNJ
Johnson & Johnson
Ultra-conservative income from J&J (JNJ) with covered calls and cash secured puts. Dividend King with 60+ years of increases.
Monthly Premium0.6-1.2%
Annualized Return7-14%
Stock Price$150-165
IV RankVery Low (15-25)
Options LiquidityGood
Dividend Yield3.2%
Why JNJ for Covered Calls & Cash Secured Puts?
JNJ is the ultimate defensive income stock. Dividend King status with 60+ consecutive years of increases. Very low volatility makes it ideal for conservative investors prioritizing capital preservation.
Example Covered Call Trade
JNJCovered Call
Strike Price$165 (4% OTM)
Expiration30 days
Premium$1.50 per share
Return If Flat0.9% ($150)
Return If Called4.9% ($810) + dividend
Keep Probability78% keep shares
Recommended Strategy for JNJ
Sell calls 3-4% OTM to add small premium to the strong dividend. JNJ is best for those wanting defensive healthcare exposure.
Risks to Consider
- Very low premium
- Litigation risks
- Drug patent expirations
- Consumer health spinoff impact
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