Best Stock on the Market

Put Spread on CMI on 6/14/2016

Double Top Formation on CMICummins Inc. (CMI) designs, manufactures, distributes, and services diesel and natural gas engines, and engine-related component products.

It operates through four segments: Engine, Distribution, Components, and Power Generation.

The Engine segment offers various diesel and natural gas powered engines under the Cummins and other customer brand names for the heavy-and medium-duty truck, bus, recreational vehicle, light-duty automotive, agricultural, construction, mining, marine, oil and gas, rail, and governmental equipment markets. This segment also provides new parts and services, as well as remanufactured parts and engines.

The Distribution segment distributes parts and filtration products, engines, and power generation products, as well as offers service solutions, including maintenance contracts, engineering services, and integrated products.

The Components segment provides emission solutions, including custom engineering systems and integrated controls, oxidation catalysts, particulate filters, oxides of nitrogen reduction systems, and engineered components; turbochargers for light-duty, mid-range, heavy-duty, and high-horsepower diesel markets; air and fuel filters, fuel water separators, lube and hydraulic filters, coolants, fuel additives, and other filtration systems; and fuel systems for heavy-duty on-highway diesel engine applications, as well as remanufactures fuel systems.

The Power Generation segment designs and manufactures components that make up power generation systems, including controls, alternators, transfer switches, and switchgears, as well as offers power generation systems, components, and services. The company sells its products to original equipment manufacturers, distributors, and other customers worldwide.

Shares have formed a "double top" and lower share prices are expected for this stock. 

We will be trading July 15th Put Options.

52-weeks Trading Range:  $79.88 - $137.42

Last Trade: $112.58

Trade

  • Buy 1 July $115.00 Put at $5.00
  • Sell 1 July $105.00 Put at $1.60
  • For a net debit of $3.40

Profit/Loss Analysis

  • Breakeven at $111.60
  • Maximum profit is $660.00 at strike of $105.00
  • Maximum loss is ($340.00) at strike of $115.00

Closing Summary

  • Sold 1 July $115.00 Put at $8.55
  • Bought 1 July $105.00 Put at $2.50

Position closed on 6/27/2016 at price of $6.05 with a 77.94% gain in 12 days.

Updates

6/27/2016 9:48:03 AM

We are taking profits on CMI Put Spread

Back to Portfolio