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Potential Randgold Resources (GOLD) Trade Has 6.26% Downside Protection

Oct 12, 2018 (Marketintelligencecenter.com via COMTEX) --

MarketIntelligenceCenter.com's patented algorithms have identified an attractive covered-call trade on Randgold Resources (<a href="http://www.marketintelligencecenter.com/symbol/GOLD">GOLD</a>). Look at the Dec 21, 2018 $77.50 covered call for a net debit in the $73.25 area.<br /> <br /> This trade has a duration of 70 days. The break-even point of this trade is the same as the net debit, which gives this trade 6.26% downside protection. If the stock closes at or above $77.50 at expiration this trade will return 5.78% or 30.17% annually (for comparison purposes only). <br /> <br /> If you're interested in a lower-cost hedged trade on Randgold Resources, consider buying the Jan 17, 2020 $50 call and selling the Dec 21, 2018 $77.50 call for a net debit of $25.40. A<br /> <br /> This hedged trade uses a longer-term bought call instead of the long stock position in a traditional covered call. The hedged trade lasts 70 days and would provide 3.53% downside protection. If Randgold Resources is at or above $77.50 when the market closes in Dec 21, 2018, this trade will make a full return of 8.26% of the initial capital at risk for an annualized return rate of 43.11% (for comparison purposes only).<br /> <br /> GOLD closed Oct 11, 2018's trading session at $78.16. In the past year, the stock has hit a 52-week low of $59.90 and 52-week high of $104.05. Randgold Resources stock has been showing support around $70.81 and resistance in the $82.63 range. Technical indicators for the stock are bearish and S&P gives GOLD 4 STARS (out of 5) buy ranking.

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