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Potential Pioneer Natural Resources (PXD) Trade Has 4.48% Downside Protection

Feb 08, 2018 (Marketintelligencecenter.com via COMTEX) --

For a hedged play on Pioneer Natural Resources (<a href="http://www.marketintelligencecenter.com/symbol/PXD">PXD</a>) MarketIntelligenceCenter.comaEUR(TM)s patented trade-picking algorithms selected a Mar 16, 2018 $175 covered call for a net debit in the $168.29 area. That is also the break-even stock price for the covered call. This trade will return 3.98%, or 40.36% annualized (for comparison purposes only), in 36 days. This covered call also provides 4.48% downside protection. A lower-cost play on Pioneer Natural Resources would use a longer term call option in place of the long position in the stock. Look at the Jan 18, 2019 $65 call and the same sold call for a net debit of $106.25.This trade only has 2.80% downside protection, but the assigned return rate rises to 3.52% or an annualized rate of 35.78% (for comparison purposes only). The current 52-week low is $125.46 and the 52-week high is $199.83. Pioneer Natural Resources stock has been showing support around $169.82 and resistance in the $187.86 range. The stock closed Feb 7, 2018's trading session at $176.19.A

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