Aluminum Corporation of China (ACH) PriceWatch Alert Targets 20.40% Return

Aluminum Corporation of China (ACH) PriceWatch Alert Targets 20.40% Return
Wednesday, July 29, 2009 8:07 AM EDT

Aluminum Corporation of China (NYSE: ACH) closed yesterday at $29.19. So far the stock has hit a 52-week low of $7.22 and 52-week high of $30.00. Aluminum Corporation of China stock has been showing support around 28.09 and resistance in the 29.97 range. Technical indicators for the stock are Bullish and S&P gives ACH a neutral 3 STAR (out of 5) hold rating. ACH appears on the Investors Observer Volume Leaders list. For a hedged play on this stock, look at a Nov '09 25 covered call (ACH KE) for a net debit in the $23.49 area. That is also the break even stock price for this trade. This covered call has an 115 day duration, provides 19.53% downside protection and a 6.43% assigned return rate for a 20.40% annualized return rate (comparison purposes only). A lower cost hedged play for this stock would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the ACH Jan '11 7.50 Call (ZFY AU) and selling the Nov '09 25 call (ACH KE) for a $16.05 debit. The trade has an 115 day life and would provide 19.32% downside protection and a 9.03% assigned return rate for a 29.00% annualized return rate (for comparison purposes only). Aluminum Corporation of China has a current annual dividend yield of 0.52%.

Copyright and Exemption Declaration :¢ÙAll articles, pictures and videos that are marked with "China Aluminum Network" on this website are copyright and belong to China Aluminium Network (www.alu.com.cn). When transshipment, any media, website or individual must list the source from "China Aluminium Network (www.alu.com.cn)". We seek legal actions against anyone that disobey this. ¢ÚArticles that marked as copy from others are for transferring more information to readers, do not represent or endorse their opinions or accuracy and reliability. When other media, website or individuals copy from our website, must keep the source. Anyone that changes the articles' sources will hold the responsibilities for copyright and law problems. We also seek legal actions against anyone that disobey this. ¢ÛIf any articles copied by our website concern the copyright and other problems, please contact us within one week.