Nokia (NOK) 3/17/10 PriceWatch Alert Support Down To $14.78

Posted: Wednesday, March 17, 2010 8:19 AM EDT
By: Market Intelligence Center Staff

Nokia (NYSE: NOK) closed yesterday at $15.14. So far the stock has hit a 52-week low of $11.01 and 52-week high of $16.58. Nokia stock has been showing support around 14.78 and resistance in the 15.38 range. Technical indicators for the stock are Bullish and S&P gives NOK a positive 4 STAR (out of 5) buy rating. NOK appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at an Oct '10 15 covered call for a net debit in the $13.84 area. That is also the break even stock price for this trade. This covered call has a 213 day duration, provides 8.59% downside protection and an 8.38% assigned return rate for a 14.36% 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 NOK Jan '11 12.50 Call and selling the Oct '10 15 call for a $1.90 debit. The trade has a 213 day life and would provide 4.89% downside protection and a 31.58% assigned return rate for a 54.00% annualized return rate (for comparison purposes only). Nokia has a current annual dividend yield of 2.65%. [WBA-Seven Summits Research]