Canadian Dollar Trust (AMEX:FXC) closed Monday's uneventful trading session at $101.84. In the past year, the ETF has hit a 52-week low of $91.82 and 52-week high of $102.70. FXC has been showing support around $101.51 and resistance in the $102.25 range. Technical indicators for the ETF are Bullish. For a hedged play on this ETF, look at the Jan '12 $101.00 covered call for a net debit in the $98.44 area. That is also the break-even price for this trade. This covered call has a duration of 298 days, provides 3.34% downside protection and an assigned return rate of 2.60% for an annualized return rate of 3.19% (for comparison purposes only). A lower-cost hedged play for this ETF would use a longer term call option in place of the covered call ETF purchase. To use this strategy look at going long the FXC Jan '12 $96.00 call and selling the Jan '12 $101.00 call for a total debit of $3.80. The trade has a lifespan of 298 days and would provide 2.00% downside protection and an assigned return rate of 31.58% for an annualized return rate of 39% (for comparison purposes only). FXC does not pay a distribution at this time. [THA-Seven Summits Research]

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