Options Insight: How to Play Caterpillar

The video discusses current market trends, focusing on the impact of the Fed policy meeting and the Atlanta Fed's GDP forecast. It highlights the industrial sector's performance, particularly Caterpillar's stock, and analyzes its volatility and correlation with oil prices. The video concludes with a trading strategy involving put options, aiming for a stock pullback.

What was the market's reaction to the Atlanta Fed's GDP forecast?

• The market experienced a minor dip.

• The market sold off sharply.

• The market remained unchanged.

• The market rallied significantly.

How has Caterpillar's stock performed year to date compared to the industrial sector?

• Caterpillar is up 22%, while the industrial sector is up 8%.

• Caterpillar is down 22%, while the industrial sector is up 8%.

• Caterpillar is down 5%, while the industrial sector is up 8%.

• Caterpillar is up 8%, while the industrial sector is up 22%.

What is the significance of the payout ratio on Caterpillar's dividend?

• It indicates a safe dividend.

• It shows a high level of risk.

• It suggests a potential dividend cut.

• It implies a stable stock price.

What is the main reason for the guarded bearish position on Caterpillar?

• High oil prices.

• Extreme market valuations.

• Strong correlation with oil.

• Low implied volatility.

What is the target stock price range for the put option strategy on Caterpillar?

• $78 to $80

• $90 to $92

• $83 to $85

• $75 to $77