Call Options on AVGO on 7/29/2012

Avago Technologies designs and supplies analog semiconductors, optoelectronics, radio-frequency and microwave components, power amplifiers, and application-specific integrated circuits (custom chips). Its more than 6,500 products are used in a broad range of applications, including mobile phones, data networking and telecommunications equipment, consumer appliances, displays, printers, servers and storage networking gear, and factory automation. Although Avago outsources the majority of its manufacturing, it maintains internal production facilities in Singapore and the US. Around 85% of sales come from outside the US, including about a third from China.Shares last traded at $36.15.

we are bullish on this name for the following reasons:

1. Shares have formed a bullish "cup and handle" and are expected to break out of this formation.
2. The firm reports its quarterly results on August 22. We expect the company will beat the estimates of 63c per share. We expect earnings of 66c per share form this firm and an upgrade or two before earnings date.

TRADE: Buy 1 AUG 35 Call

Trade Buy 1 January $50.00 Call at $1.50 For a net debit of $1.50 Profit/Loss Analysis Breakeven at $51.50 Maximum profit is unbounded Maximum loss is ($150.00) at strike of $50.00 Closing Summary Sold 1 January $50.00 Call at $2.55

Position closed on 8/8/2012 at price of $2.55 with a 70.00% gain in 9 days.

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