MORNING UPDATE: PriceWatch Alerts for XOM and More... for 2014-05-12 |
| ------------------------------------------------------------------ MORNING UPDATE FOR MAY 12, 2014 PriceWatch Alerts for XOM, PRU, DIS, BBRY, ATVI, AMGN, UNH, YHOO, BUD and ILMN. Exxon Mobil (NYSE: XOM) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $101.95 while selling the January $110.00 call will produce a new covered call with a break-even point around $100.60. At that price, this position has a target return of 9.3%. This trade will have roughly 1.3% downside protection, while still aiming for a 9.3% return in 250 days. It will lock in that return as long as Exxon Mobil is above $110.00 on 1/17/2015. For comparison purposes only, this XOM covered call aims for an annualized return rate of 13.6%. Prudential Financial (NYSE: PRU) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $83.75 while simultaneously selling the September $82.50 call will result in a new position with a target return of 4.4%. Based on recent prices, this position will cost about $79.05, which is also the trade?s breakeven point. At that level, this covered call has 5.6% downside protection, while still providing a 4.4% return in 131 days as long as PRU is above $82.50 on 9/20/2014. For comparison purposes only, this Prudential Financial covered call aims for an annualized return rate of 12.1%. Walt Disney (NYSE: DIS) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $81.95 while selling the October $80.00 call will produce a new covered call with a break-even point around $76.35. At that price, this position has a target return of 4.8%. This trade will have roughly 6.8% downside protection, while still aiming for a 4.8% return in 159 days. It will lock in that return as long as Walt Disney is above $80.00 on 10/18/2014. For comparison purposes only, this DIS covered call aims for an annualized return rate of 11.0%. Blackberry (NASDAQ: BBRY) has been chosen by InvestorsObserver analysts as a candidate for a new covered call today. Selling the December $7.00 call while at the same time buying BBRY stock for $7.29 will produce a new covered call with a target return of 16.7%. Based on recent data, this trade will cost about $6.00, which is also the covered call?s breakeven point. At that price, this covered call has 17.7% downside protection, while seeking an assigned return of 16.7% return in 222 days. If BBRY is higher than $7.00 on 12/20/2014, we are assured that simple return. For comparison purposes only, that equates to an annualized return rate of 27.4%. Activision (NASDAQ: ATVI) has been selected by InvestorsObserver analysts as a stock that is a strong candidate for a new covered call today. Selling the November $20.00 call while simultaneously buying ATVI stock for $20.79 will result in a new position with a break-even point around $18.66. At that price, this position has a target return of 7.2%. This trade has 10.2% downside protection, while still providing a 7.2% return in 194 days as long as ATVI is above $20.00 on 11/22/2014. For comparison purposes only, this Activision covered call targets an annualized return rate of 13.5%. Amgen (NASDAQ: AMGN) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $111.48 while selling the October $110.00 call will produce a new covered call with a break-even point around $104.23. At that price, this position has a target return of 5.5%. This trade will have roughly 6.5% downside protection, while still aiming for a 5.5% return in 159 days. It will lock in that return as long as Amgen is above $110.00 on 10/18/2014. For comparison purposes only, this AMGN covered call aims for an annualized return rate of 12.7%. UnitedHealth Group (NYSE: UNH) has been selected by InvestorsObserver analysts as a stock that is an ideal candidate for a new covered call today. Buying the stock for $76.95 while simultaneously selling the September $77.50 call will result in a new position with a target return of 4.9%. Based on recent prices, this position will cost about $73.90, which is also the trade?s breakeven point. At that level, this covered call has 4.0% downside protection, while still providing a 4.9% return in 131 days as long as UNH is above $77.50 on 9/20/2014. For comparison purposes only, this UnitedHealth Group covered call aims for an annualized return rate of 13.6%. Yahoo (NASDAQ: YHOO) has been identified by InvestorsObserver analysts as being well-positioned for a new covered call today. Buying the stock for $33.76 while selling the July $33.00 call will produce a new covered call with a break-even point around $31.11. At that price, this position has a target return of 6.1%. This trade will have roughly 7.8% downside protection, while still aiming for a 6.1% return in 68 days. It will lock in that return as long as Yahoo is above $33.00 on 7/19/2014. For comparison purposes only, this YHOO covered call aims for an annualized return rate of 32.6%. Anheuser-Busch InBev (NYSE: BUD) has been chosen by InvestorsObserver analysts as a candidate for a new covered call today. Selling the September $110.00 call while at the same time buying BUD stock for $109.00 will produce a new covered call with a target return of 5.0%. Based on recent data, this trade will cost about $104.80, which is also the covered call?s breakeven point. At that price, this covered call has 3.9% downside protection, while seeking an assigned return of 5.0% return in 131 days. If BUD is higher than $110.00 on 9/20/2014, we are assured that simple return. For comparison purposes only, that equates to an annualized return rate of 13.8%. Illumina (NASDAQ: ILMN) has been selected by InvestorsObserver analysts as a stock that is a strong candidate for a new covered call today. Selling the June $140.00 call while simultaneously buying ILMN stock for $143.00 will result in a new position with a break-even point around $133.40. At that price, this position has a target return of 4.9%. This trade has 6.7% downside protection, while still providing a 4.9% return in 40 days as long as ILMN is above $140.00 on 6/21/2014. For comparison purposes only, this Illumina covered call targets an annualized return rate of 45.1%. *Annualized returns are shown for comparison purposes only Are you looking for a more conservative strategy that solves the pitfalls that come with covered calls investing? 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Check out PowerOptions SmartHistoryXL (http://www.poweropt.com/optionsbacktesting-instructions.asp) and start back testing today! NOTE: All stocks and options shown are examples only. These are not recommendations to buy or sell any security. STOCKS ON THE MOVE Alnylam Pharmaceuticals (ALNY), Logitech (LOGI) and Peabody Energy (BTU) are rising this morning, while Avanir Pharmaceuticals (AVNR) and Zulily (ZU) are falling. TCF Financial (TCB) and SYNNEX (SNX) were upgraded by analysts this morning, while Barclays PLC (BCS) was downgraded. INTERNATIONAL MARKETS In Asia, trading finished with varied results overnight to open up the new week. Stocks were very strong in China, Hong Kong, and India, but weak in Australia and Japan. The Indian Sensex rose 2.4%, the Shanghai SEC gained 2.1% and the Hong Kong Hang Seng added 1.8%. Meanwhile, the Japanese Nikkei 225 fell 0.3% and the Taiwan TSEC dropped 0.9%. India's election and China's plan for less financial market regulation have encouraged traders. The major European indices are all higher so far this morning. The German DAX is up 1.0% at last check, while the FTSE 100 and Euronext 100 are each up 0.3%. Gains have been concentrated in the mining sector after an analyst upgrade from JPMorgan Cazenove strategists moved the entire group from underweight to overweight. FUTURES & CURRENCIES In the commodities futures pits, energy contracts are mixed, with front- month West Texas Intermediate crude oil higher by 0.4% to $100.37. Gasoline and heating oil are each higher by less than one percent, but natural gas is down 1.1%. Metals are all higher, including gold up 0.6% silver higher by 1.7%, and copper gaining 2.0%. The U.S. Dollar is slightly stronger against the Japanese Yen, but weaker across the board versus other international currencies. PUT/CALL RATIO Yesterday, 981,880 call contracts traded on the Chicago Board Options Exchange (CBOE) compared to 710,647 put contracts. The single-session put/call was 0.72, while the 20-day moving average is now at 0.62. TODAY'S ECONOMIC CALENDAR 02:00 PM Apr Treasury Budget EARNINGS EXPECTED TODAY AU MNKD RAX This Morning Update was prepared with data and information provided by: PowerOptionsPlus.com - The Best Way To Find, Compare, Analyze, and Make Money On Option Investments - Forbes Best of the Web Winner. InvestorsObserver -- Better Strategies for Making Money in Up, Down, and Flat Markets -> Get Started with InvestosObserver's 100% Free Essentials Service: http://www.poweropt.com/io All stocks and options shown are examples only. These are not recommendations to buy or sell any security and they do not represent in any way a positive or negative outlook for any security. Potential returns do not take into account your trade size, brokerage commissions, taxes or our subscription fees which will affect actual investment returns. Stocks and options involve risk and are not suitable for all |
