Filed under: Major movement , Earnings reports , Good news , XM Satellite Radio (XMSR) , Options , Technical Analysis XM Satellite Radio (NASDAQ: XMSR ) shares are trading higher today after the company announced it gained 322,000 new net subscribers during the second quarter , 17% higher than the same quarter last year. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on XMSR. After hitting a one-year high of $16.44 in November, the stock hit a one-year low of $6.78 earlier this month. XMSR opened this morning at $8.75. So far today the stock has hit a low of $8.69 and a high of $9.02. As of 12:15, XMSR is trading at $9.04, up 48 cents (5.8%). The chart for XMSR looks bearish and steady, while S&P gives the stock a neutral 3 Stars (out of 5) hold rating. For a bullish hedged play on this stock, I would consider a September bull-put credit spread below the $6 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 9.9% return in just two months as long as XMSR is above $6 at September expiration. XM would have to fall by more than 33% before we would start to lose money. XMSR hasn't been below $6.75 at all in the past year and has shown support around $7.25 recently. T ...
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Filed under: Major movement , Earnings reports , Good news , XM Satellite Radio (XMSR) , Options , Technical Analysis XM Satellite Radio (NASDAQ: XMSR ) shares are trading higher today after the company announced it gained 322,000 new net subscribers during the second quarter , 17% higher than the same quarter last year. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on XMSR. After hitting a one-year high of $16.44 in November, the stock hit a one-year low of $6.78 earlier this month. XMSR opened this morning at $8.75. So far today the stock has hit a low of $8.69 and a high of $9.02. As of 12:15, XMSR is trading at $9.04, up 48 cents (5.8%). The chart for XMSR looks bearish and steady, while S&P gives the stock a neutral 3 Stars (out of 5) hold rating. For a bullish hedged play on this stock, I would consider a September bull-put credit spread below the $6 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 9.9% return in just two months as long as XMSR is above $6 at September expiration. XM would have to fall by more than 33% before we would start to lose money. XMSR hasn't been below $6.75 at all in the past year and has shown support around $7.25 recently. T ...