One Week Options. Are They A Good Bet In Times like This?

Look at how these these four stocks traded last week. 1) What a great week for one week Call option players on Boeing even though the stock ended up down .83 cents on the week. 2) Roku. Roku hasn't yet recovered from a not so good quarterly report. Roku lost $1.13 on the week. (Netflix in somewhat the same space was up $35.780.) 3) Disney suprised. I talked about that in a recent blog. 4) Now Caterpillar. It was up $12.83 Now The D.J.I. was down .11% or basically flat. In good times Call options can be your best friend. To be continued.

Sept. 23 th. The DJI Up Over 800 Points and Caterpillar Jumps

I played Boeing Calls three times this week and won everytime. In a blog two days ago I reported I don't like playing options on Thursday that expire the next day. The reason being is that if you guess the wrong direction you will lose all your money. Failure is harsh medicine.That being said this time I was watching Caterpillar and it opened down as did the markets. Inflation report numbers came out and everyone got it wrong. I jumped in. Look at how it crashed on the opening.
I got in at 9:39 a.m. Look at the chart to see where the stock was at that time. Call me crazy. Here is a better "one day" look at the chart.
Now look at when I got in. I got in at 9:35 a.m. and paid $250.00 for one contract. The low on the day was $2.05 and that was before I got in. I had just made more than twice that amount in Canadian dollars paying Boeing so that's the way I justified my actions.
A drop of like six or seven dollars. For the first ten minutes after I got in I thought I was smoked! How could any stock rebound from a drop that large? Then it started to rebound ever so slightly and I just wanted my money back. The market could roll over and sink again. Anything could happen. In my quest to get out I fought with the option makers and cancelled two sell tickets before I got filled. Can you see above how that happened at 10:11 a.m. and at 10:21 a.m. I cancelled and resubmited a sell ticket? I was chasing the markets down. Finally at 10:21 a.m. I was out. Five minutes or so later it started to explode upwards.
Notice these options hit a high of $9.74 on the day and notice that only 125 contracts traded. Caterpillar has over 128,000 employees. Do the math. Only a small percent of them are playing options on their companies stock. Life is what you make it. Most people don't play options. Today I went to the races and I got spooked as the markets took a slight pause one hour into the morning trading.


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