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Berkshire Hathaway B (NYSE: BRK.B) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $89.32 while simultaneously selling the June $90.00 call will result in a new position with a target return of 6.7 %. Based on recent prices, this position will cost about $84.32, which is also the trade’s breakeven point. At that level, this covered call has 5.6 % downside protection, while still providing a 6.7 % return in 191 days as long as BRK.B is above $90.00 on 6/22/2013. For comparison purposes only, this Berkshire Hathaway B covered call aims for an annualized return rate of 12.9 %.

Eli Lilly (NYSE: LLY) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $49.00 while selling the April $49.00 call will produce a new covered call with a break-even point around $46.96. At that price, this position has a target return of 4.3 %. This trade will have roughly 4.2 % downside protection, while still aiming for a 4.3 % return in 128 days. It will lock in that return as long as Eli Lilly is above $49.00 on 4/20/2013. For comparison purposes only, this LLY covered call aims for an annualized return rate of 12.4 %.

Dicks Sporting Goods (NYSE: DKS) has been chosen by InvestorsObserver analysts as a candidate for a new covered call today. Selling the March $47.00 call while at the same time buying DKS stock for $47.17 will produce a new covered call with a target return of 6.0 %. Based on recent data, this trade will cost about $44.32, which is also the covered call’s breakeven point. At that price, this covered call has 6.0 % downside protection, while seeking an assigned return of 6.0 % return in 93 days. If DKS is higher than $47.00 on 3/16/2013, we are assured that simple return. For comparison purposes only, that equates to an annualized return rate of 23.7 %.

Harley Davidson (NYSE: HOG) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $49.20 while simultaneously selling the February $49.00 call will result in a new position with a target return of 4.7 %. Based on recent prices, this position will cost about $46.79, which is also the trade’s breakeven point. At that level, this covered call has 4.9 % downside protection, while still providing a 4.7 % return in 65 days as long as HOG is above $49.00 on 2/16/2013. For comparison purposes only, this Harley Davidson covered call aims for an annualized return rate of 26.5 %.

Royal Gold (NASDAQ: RGLD) has been selected by InvestorsObserver analysts as a stock that is a strong candidate for a new covered call today. Selling the April $82.50 call while simultaneously buying RGLD stock for $83.64 will result in a new position with a break-even point around $76.84. At that price, this position has a target return of 7.4 %. This trade has 8.1 % downside protection, while still providing a 7.4 % return in 128 days as long as RGLD is above $82.50 on 4/20/2013. For comparison purposes only, this Royal Gold covered call targets an annualized return rate of 21.0 %.

 

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