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Strategies & Market Trends : Value Investing

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To: Paul Senior who wrote (29991)	6/25/2008 4:48:53 PM
From: E_K_S	of 78747

Hi Paul - Hedged a small portion of my ELP shares that are in my IRA by writing Jan 2009 $20 covered calls for $2.50. The company is near an all time high and has significantly outperformed the S&P 500. The recent break out in the stock price is on better than average volume which is bullish. finance.yahoo.com^gspc;indicator=volume;charttype=line;crosshair=on;ohlcvalues=0;logscale=on;source=undefined The company pays an annual dividend each April, so by selling a few covered calls, I protect a portion of my 33% gain YTD. The $2.50 call price is a 12.5% premium to the current price. Brazil has recently raised their interest rates while the FED has left rates unchanged. I suspect the $/Real will continue to remain weak for the foreseeable future but once U.S. rates start to increase, it may impact the relative share price due to lower foreign currency gains. EKS

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