Aetna (AET) 10/23/09 PriceWatch Alert Targets 15.61% Downside Protection

Posted: Friday, October 23, 2009 8:28 AM EDT

Aetna (NYSE: AET) closed yesterday at $25.62. So far the stock has hit a 52-week low of $14.21 and 52-week high of $34.87. Aetna stock has been showing support around 25.05 and resistance in the 26.13 range. Technical indicators for the stock are Bearish and S&P gives AET a neutral 3 STAR (out of 5) hold rating. AET appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Jan '10 22.50 covered call (AET AX) for a net debit in the $21.62 area. That is also the break even stock price for this trade. This covered call has an 85 day duration, provides 15.61% downside protection and a 4.07% assigned return rate for a 17.48% annualized return rate (comparison purposes only). Aetna has a current annual dividend yield of 0.16%. [FBB-Seven Summits Research]

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