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Potential Occidental Petroleum (OXY) Trade Has 2.65% Downside Protection

Mar 08, 2018 ( via COMTEX) --'s patented algorithms have identified an attractive covered-call trade on Occidental Petroleum (<a href="">OXY</a>). Look at the Apr 20, 2018 $65 covered call for a net debit in the $63.46 area.<br /> <br /> This trade has a duration of 43 days. The break-even point of this trade is the same as the net debit, which gives this trade 2.65% downside protection. If the stock closes at or above $65 at expiration this trade will return 2.42% or 20.59% annually (for comparison purposes only). <br /> <br /> If you're interested in a lower-cost hedged trade on Occidental Petroleum, consider buying the Jan 18, 2019 $50 call and selling the Apr 20, 2018 $65 call for a net debit of $13.67. 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 43 days and would provide 2.33% downside protection. If Occidental Petroleum is at or above $65 when the market closes in Apr 20, 2018, this trade will make a full return of 9.72% of the initial capital at risk for an annualized return rate of 82.58% (for comparison purposes only).<br /> <br /> OXY closed Mar 7, 2018's trading session at $65.19. In the past year, the stock has hit a 52-week low of $57.20 and 52-week high of $78.09. Occidental Petroleum stock has been showing support around $63.53 and resistance in the $66.54 range. Technical indicators for the stock are bearish and S&P gives OXY 3 STARS (out of 5) hold ranking.

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