May 14, 2013 (Marketintelligencecenter.com via COMTEX) -- Pulte Homes Inc. (NYSE:PHM) closed Monday's trading session at $23.39. In the past year, the stock has hit a 52-week low of $7.63 and 52-week high of $23.59. Pulte Homes (PHM) stock has been showing support around $22.84 and resistance in the $23.82 range. Technical indicators for the stock are Bullish and S&P gives Pulte Homes (PHM) a weak 2 STARS (out of 5) sell rating. For a hedged play on Pulte Homes (PHM), look at the Oct '13 $22.00 covered call for a net debit in the $20.29 area. That is also the break-even stock price for this trade. This covered call has a duration of 158 days, provides 13.25% downside protection and an assigned return rate of 8.43% for an annualized return rate of 19.47% (for comparison purposes only). A lower-cost hedged play for Pulte Homes (PHM) would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the Pulte Homes (PHM) Jan '14 $17.00 call and selling the Oct '13 $22.00 call for a total debit of $4.05. The trade has a lifespan of 158 days and would provide 10.00% downside protection and an assigned return rate of 23.46% for an annualized return rate of 54% (for comparison purposes only). Pulte Homes (PHM) has a current trailing average dividend yield of 0%.
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As of Friday, 05-10-2013 23:59, the latest Comtex SmarTrendA? Alert,
an automated pattern recognition system, indicated a DOWNTREND on
05-18-2012 for PHM @ $8.48.
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