Potential Reliance Steel and Aluminum (RS) Trade Has $47.81 Breakeven

Reliance Steel & Aluminum Co （NYSE: RS） closed Thursday's trading session at $51.21. In the past year, the stock has hit a 52-week low of $34.58 and 52-week high of $55.47. Reliance Steel and Aluminum stock has been showing support around $50.46 and resistance in the $52.22 range. Technical indicators for the stock are Bullish and S&P gives RS a neutral 3 STARS （out of 5） hold rating. For a hedged play on this stock, look at the Feb '11 $50.00 covered call for a net debit in the $47.81 area. That is also the break-even stock price for this trade. This covered call has a duration of 54 days, provides 6.64% downside protection and an assigned return rate of 4.58% for an annualized return rate of 30.96% （for comparison purposes only）. Reliance Steel and Aluminum has a current annual dividend yield of 0.80%. [ABR-Seven Summits Research]