CSCO opened this morning at $22.95. So far today the stock has hit a low of $22.55 and a high of $25.10. As of 12:00, CSCO is trading at $22.63 up 11 cents (0.5%). The chart for CSCO looks bullish and S&P gives CSCO a positive 4 STARS (out of 5) buy ranking.
For a bullish hedged play on this stock, I would consider an April bull-put credit spread below the $20 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 an 11.1% return in three months as long as CSCO is above $20 at April expiration. Cisco would have to fall by more than 12% before we would start to lose money. Learn more about this type of trade here.
CSCO has not been below $20 since July and has shown support around $22 recently.
Brent Archer is an options analyst and writer at Investors Observer.
DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent controls bullish hedged positions in CSCO.