ImClone Systems (IMCL) PriceWatch Alert Up To 8.67% Return

Posted: Wednesday, October 15, 2008 8:07 AM EDT

ImClone Systems (NasdaqNM: IMCL) closed yesterday at $67.78. So far the stock has hit a 52-week low of $36.87 and 52-week high of $68.89. ImClone Systems stock has been showing support around 67.37 and resistance in the 68.37 range. Technical indicators for the stock are Bullish. IMCL appears on the Investors Observer Momentum Plays list. For a hedged play on this stock, look at a Jan '09 65 covered call (QCI AM) for a net debit in the $63.58 area. That is also the break even stock price for this trade. This covered call has a 94 day duration, provides 6.20% downside protection and a 2.23% assigned return rate for an 8.67% 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 IMCL Jan '10 60 Call (YCF AL) and selling the Jan '09 65 call (QCI AM) for a $4.25 debit. The trade has a 94 day life and would provide 5.21% downside protection and a 17.65% assigned return rate for a 69.00% annualized return rate (for comparison purposes only). ImClone Systems does not pay dividends at this time. [For more information on these strategies along with more details on possible risks go to www.iotogo.com/HPWAinfo]

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