Sybase (SY) PriceWatch Alert Up To 9.08% Return

Posted: Monday, June 08, 2009 8:07 AM EDT

Sybase (NYSE: SY) ended the last trading session at $33.93. So far the stock has hit a 52-week low of $22.20 and 52-week high of $36.99. Sybase stock has been showing support around 33.58 and resistance in the 34.28 range. Technical indicators for the stock are Bullish and S&P gives SY a positive 4 STAR (out of 5) buy rating. SY appears on the Investors Observer Momentum Plays list. For a hedged play on this stock, look at a Jan '10 30 covered call (WYB AF) for a net debit in the $28.43 area. That is also the break even stock price for this trade. This covered call has a 222 day duration, provides 16.21% downside protection and a 5.52% assigned return rate for a 9.08% 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 SY Jan '10 22.50 Call (WYB AX) and selling the Jan '10 30 call (WYB AF) for a $6.50 debit. The trade has a 222 day life and would provide 14.53% downside protection and a 15.38% assigned return rate for a 25.00% annualized return rate (for comparison purposes only). Sybase 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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