Pan American Silver (NASDAQ:PAAS) closed Monday's losing trading session at $33.60. In the past year, the stock has hit a 52-week low of $22.21 and 52-week high of $43.06. Pan American Silver (PAAS) stock has been showing support around $32.92 and resistance in the $34.46 range. Technical indicators for the stock are Bullish. For a hedged play on Pan American Silver (PAAS), look at the Oct '11 $32.00 covered call for a net debit in the $29.80 area. That is also the break-even stock price for this trade. This covered call has a duration of 95 days, provides 11.31% downside protection and an assigned return rate of 7.38% for an annualized return rate of 28.36% (for comparison purposes only). A lower-cost hedged play for Pan American Silver (PAAS) would use a longer term call option in place of the covered call stock purchase. To use this strategy look at going long the Pan American Silver (PAAS) Jan '13 $15.00 call and selling the Oct '11 $32.00 call for a total debit of $16.40. The trade has a lifespan of 95 days and would provide 6.55% downside protection and an assigned return rate of 3.66% for an annualized return rate of 14% (for comparison purposes only). Pan American Silver (PAAS) has a current annual dividend yield of 0.30%. [ATU-Seven Summits Research] C

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