Potential Hewlett Packard Enterprise Comp (HPE) Trade Has 7.37% Downside Protection
Sep 11, 2017 (Marketintelligencecenter.com via COMTEX News Network) -- The patented option-trade picking algorithms that power MarketIntelligenceCenter.com's Artificial Intelligence Center Aare highlighting two trades on Hewlett Packard Enterprise Comp (HPE) today after it closed at $13.09 on Sep 8, 2017. For more conservative investors, look at a covered call using the Feb 16, 2018 $13 call for a net debit of about $12.14. This trade will return 6.99% (16.16% annualized, for comparison purposes only) as long as the stock closes above $13 at expiration. Hewlett Packard Enterprise Comp can fall 7.37% before causing a problem. For investors with a higher appetite for risk, consider a diagonal spread with a Jan 18, 2019 $8 call taking the place of the long stock position and the same short position in the Feb 16, 2018 $13 call. This trade only costs about $4.41 to get into and the rate of return increases to 12.84% (16.16% annualized, for comparison purposes only) but the downside protection falls to 5.25%.
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