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Costco Wholesale (NASDAQ: COST) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $116.57 while selling the October $120.00 call will produce a new covered call with a break-even point around $114.59. At that price, this position has a target return of 4.7 %. This trade will have roughly 1.7 % downside protection, while still aiming for a 4.7 % return in 82 days. It will lock in that return as long as Costco Wholesale is above $120.00 on 10/19/2013. For comparison purposes only, this COST covered call aims for an annualized return rate of 21.0 %.

PepsiCo (NYSE: PEP) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $85.31 while simultaneously selling the October $87.50 call will result in a new position with a target return of 4.2 %. Based on recent prices, this position will cost about $83.98, which is also the trade’s breakeven point. At that level, this covered call has 1.6 % downside protection, while still providing a 4.2 % return in 82 days as long as PEP is above $87.50 on 10/19/2013. For comparison purposes only, this PepsiCo covered call aims for an annualized return rate of 18.7 %.

Macy's (NYSE: M) has been chosen by InvestorsObserver analysts as a candidate for a new covered call today. Selling the November $47.00 call while at the same time buying M stock for $48.17 will produce a new covered call with a target return of 4.2 %. Based on recent data, this trade will cost about $45.12, which is also the covered call’s breakeven point. At that price, this covered call has 6.3 % downside protection, while seeking an assigned return of 4.2 % return in 110 days. If M is higher than $47.00 on 11/16/2013, we are assured that simple return. For comparison purposes only, that equates to an annualized return rate of 13.8 %.

Family Dollar Stores (NYSE: FDO) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $68.52 while simultaneously selling the September $67.50 call will result in a new position with a target return of 4.3 %. Based on recent prices, this position will cost about $64.72, which is also the trade’s breakeven point. At that level, this covered call has 5.5 % downside protection, while still providing a 4.3 % return in 54 days as long as FDO is above $67.50 on 9/21/2013. For comparison purposes only, this Family Dollar Stores covered call aims for an annualized return rate of 29.0 %.

Dreamworks Animation (NASDAQ: DWA) has been selected by InvestorsObserver analysts as a stock that is a strong candidate for a new covered call today. Selling the December $22.50 call while simultaneously buying DWA stock for $24.41 will result in a new position with a break-even point around $21.01. At that price, this position has a target return of 7.1 %. This trade has 13.9 % downside protection, while still providing a 7.1 % return in 145 days as long as DWA is above $22.50 on 12/21/2013. For comparison purposes only, this Dreamworks Animation covered call targets an annualized return rate of 17.8 %.

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