Apple (AAPL) Showing Bearish Technicals But Could Fall Through $467.68 Support

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Feb 12, 2013 ( via COMTEX) -- Apple Inc (NASDAQ:AAPL) closed Monday's trading session at $479.93. In the past year, the stock has hit a 52-week low of $435.00 and 52-week high of $705.07. Apple (AAPL) stock has been showing support around $467.68 and resistance in the $491.06 range. Technical indicators for the stock are Bearish and S&P gives Apple (AAPL) a very positive 5 STARS (out of 5) strong buy rating. For a hedged play on Apple (AAPL), look at the Apr '13 $475.00 covered call for a net debit in the $454.48 area. That is also the break-even stock price for this trade. This covered call has a duration of 67 days, provides 5.30% downside protection and an assigned return rate of 4.52% for an annualized return rate of 24.60% (for comparison purposes only). A lower-cost hedged play for Apple (AAPL) would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the Apple (AAPL) Jan '14 $330.00 call and selling the Apr '13 $475.00 call for a total debit of $128.55. The trade has a lifespan of 67 days and would provide 4.45% downside protection and an assigned return rate of 12.80% for an annualized return rate of 70% (for comparison purposes only). Apple (AAPL) has a current annual dividend yield of 2.26%.

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