UltraShort QQQ ProShares (QID) 2/9/10 PriceWatch Alert Bullish Price Movement
Posted: Tuesday, February 09, 2010 8:42 AM EDT
By: Market Intelligence Center Staff
UltraShort QQQ ProShares (PACF: QID) closed yesterday at $21.58. So far QID has hit a 52-week low of $18.27 and 52-week high of $71.39. QID has been showing support around 20.88 and resistance in the 21.96 range. Technical indicators are Bullish. QID appears on the Investors Observer Select ETF and HOLDR list. For a hedged play on this stock, look at a Jan '11 21 covered call for a net debit in the $17.53 area. That is also the break even stock price for this trade. This covered call has a 347 day duration, provides 18.77% downside protection and a 19.79% assigned return rate for a 20.82% 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 QID Jan '11 17 Call and selling the Jan '11 21 call for a $1.95 debit. The trade has a 347 day life and would provide 12.19% downside protection and a 105.13% assigned return rate for an 111.00% annualized return rate (for comparison purposes only). [ATU-Seven Summits Research]
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