May 09, 2013 (Marketintelligencecenter.com via COMTEX) -- Toll Brothers Inc. (NYSE:TOL) closed Wednesday's trading session at $36.00. In the past year, the stock has hit a 52-week low of $23.78 and 52-week high of $38.36. Toll Brothers (TOL) stock has been showing support around $34.80 and resistance in the $36.60 range. Technical indicators for the stock are Bullish and S&P gives Toll Brothers (TOL) a neutral 3 STARS (out of 5) hold rating. For a hedged play on Toll Brothers (TOL), look at the Sep '13 $38.00 covered call for a net debit in the $34.05 area. That is also the break-even stock price for this trade. This covered call has a duration of 135 days, provides 5.42% downside protection and an assigned return rate of 11.60% for an annualized return rate of 31.36% (for comparison purposes only). A lower-cost hedged play for Toll Brothers (TOL) would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the Toll Brothers (TOL) Jan '14 $31.00 call and selling the Sep '13 $38.00 call for a total debit of $5.05. The trade has a lifespan of 135 days and would provide -0.14% downside protection and an assigned return rate of 38.61% for an annualized return rate of 104% (for comparison purposes only). Toll Brothers (TOL) has a current trailing average dividend yield of 0%.
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As of Sunday, 05-05-2013 23:59, the latest Comtex SmarTrendA? Alert,
an automated pattern recognition system, indicated a DOWNTREND on
06-01-2012 for TOL @ $25.79.
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provider or go to www.mysmartrend.com
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