Best Stock on the Market

Put Options on CAT on 12/1/2015

Bearish Head and Shoulders on CATCaterpillar Inc. (CAT) manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide.

The company’s Construction Industries segment offers backhoe, small wheel, skid steer, multi-terrain, compact track, medium and compact wheel, and track-type loaders; mini, wheel, and track excavators; track-type tractors; and select work tools, motor graders, telehandlers, soil compactors, and pipelayers, as well as its related parts for the heavy and general construction, rental, mining and quarry, and aggregates markets. Its Resource Industries segment provides electric rope and hydraulic shovels; draglines; drills; highwall and longwall miners; hard rock vehicles; articulated, large mining, and off-highway trucks; large wheel loaders; wheel tractor scrapers; wheel dozers; machinery components; and electronics and control systems for use in mining and quarry applications.

The company’s Energy & Transportation segment offers reciprocating engines; reciprocating engine powered generator sets; integrated systems and solutions for the electric power generation industry; and turbines and its related services, centrifugal gas compressors, diesel-electric locomotives and components, and rail-related products and services. Its Financial Products segment provides retail and wholesale financing primarily for Caterpillar equipment, machinery, and engines; offers property, casualty, life, accident, and health insurance; insurance brokerage services; and purchases short-term trade receivables. 

Shares are suffering from a strong dollar and have formed a bearish "head and shoulders" formation. Lower share prices are expected for this stock.

 

52-Weeks Trading Range: $62.99 to $101.46

Last Trade: $71.15

 

We are trading December 18th Options.

Trade

  • Buy 1 December $71.50 Put at $1.74
  • For a net debit of $1.74

Profit/Loss Analysis

  • Breakeven at $69.76
  • Maximum profit is unbounded
  • Maximum loss is ($174.00) at strike of $72.00

Closing Summary

  • Sold 1 December $71.50 Put at $3.80

Position closed on 12/7/2015 at price of $3.80 with a 118.39% gain in 5 days.

Updates

12/7/2015 10:59:52 AM

Taking profits on CAT Put Options at $3.80

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