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Gilead Sciences (NASDAQ: GILD) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $68.34 while selling the January $67.50 call will produce a new covered call with a break-even point around $64.04. At that price, this position has a target return of 5.4 %. This trade will have roughly 6.3 % downside protection, while still aiming for a 5.4 % return in 86 days. It will lock in that return as long as Gilead Sciences is above $67.50 on 1/19/2013. For comparison purposes only, this GILD covered call aims for an annualized return rate of 22.9 %.

ResMed (NYSE: RMD) has been selected by InvestorsObserver analysts as a stock that is a strong candidate for a new covered call today. Selling the January $40.00 call while simultaneously buying RMD stock for $41.89 will result in a new position with a break-even point around $38.39. At that price, this position has a target return of 4.2 %. This trade has 8.4 % downside protection, while still providing a 4.2 % return in 86 days as long as RMD is above $40.00 on 1/19/2013. For comparison purposes only, this ResMed covered call targets an annualized return rate of 17.8 %.

United Technologies (NYSE: UTX) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $77.90 while simultaneously selling the February $77.50 call will result in a new position with a target return of 4.2 %. Based on recent prices, this position will cost about $74.40, which is also the trade’s breakeven point. At that level, this covered call has 4.5 % downside protection, while still providing a 4.2 % return in 114 days as long as UTX is above $77.50 on 2/16/2013. For comparison purposes only, this United Technologies covered call aims for an annualized return rate of 13.3 %.

 

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ARM Holdings (NASDAQ: ARMH) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $32.09 while simultaneously selling the January $32.00 call will result in a new position with a target return of 6.5 %. Based on recent prices, this position will cost about $30.04, which is also the trade’s breakeven point. At that level, this covered call has 6.4 % downside protection, while still providing a 6.5 % return in 86 days as long as ARMH is above $32.00 on 1/19/2013. For comparison purposes only, this ARM Holdings covered call aims for an annualized return rate of 27.7 %.

CIT Group (NYSE: CIT) has been chosen by InvestorsObserver analysts as a candidate for a new covered call today. Selling the January $37.00 call while at the same time buying CIT stock for $37.51 will produce a new covered call with a target return of 4.7 %. Based on recent data, this trade will cost about $35.34, which is also the covered call’s breakeven point. At that price, this covered call has 5.8 % downside protection, while seeking an assigned return of 4.7 % return in 86 days. If CIT is higher than $37.00 on 1/19/2013, we are assured that simple return. For comparison purposes only, that equates to an annualized return rate of 19.9 %.

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