Symantec (SYMC) Down Over 1% On Heavy Volume And Trading Just Shy Of Its 52 Week High

Posted: Friday, November 13, 2009 8:48 AM EDT

Symantec (NasdaqNM: SYMC) closed yesterday at $17.34. So far the stock has hit a 52-week low of $10.05 and 52-week high of $18.17. Symantec stock has been showing support around 17.00 and resistance in the 17.92 range. Technical indicators for the stock are Bullish and S&P gives SYMC a neutral 3 STAR (out of 5) hold rating. SYMC appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at an Apr '10 17 covered call (SYQ DQ) for a net debit in the $15.59 area. That is also the break even stock price for this trade. This covered call has a 155 day duration, provides 10.09% downside protection and a 9.04% assigned return rate for a 21.30% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the SYMC Jan '11 12.50 Call (OBL AV) and selling the Apr '10 17 call (SYQ DQ) for a $4.20 debit. The trade has a 155 day life and would provide 3.69% downside protection and a 7.14% assigned return rate for a 17.00% annualized return rate (for comparison purposes only). Symantec does not pay dividends at this time. [FBB-Seven Summits Research]

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