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$Hertz. Sometimes One Month Out Options Can Be Your Very Best Friend

One month until expiring options can be your very best friend. This time however we are looking at options on a stock in the five dollar range which are less predictable in nature compared to stocks in higher price ranges. The pace in trading them can be slower. Case in point is Hertz. View the following information. First it's trading chart today followed by it's five day chart. ... They are July 17th options and you can see how they had a slight pop on the opening. One of the things I like about this situation is how it's peirs in the industry are trading on the day. Now this readout. Notice the high of $.77 earlier in the morning. Let's move on to Tuesday morning. All three of the stock's piers are up. Whether it's drone stocks or drug stocks or auto retailing stocks it helps when the sector your'e trying to play is in agreeance with you're line of thinkings. Once again it is. Now this. Chat GTP would advise you from staying away from positions li...
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The Appetite For Caterpillar Options Going Into An Earning's Report Is Quite Small .

Let's start with this. Caterpillar has an earnings report coming out on April 30th. You should listen to it. It's not going to be difficult to find.
Now look at these how these two series of options closed out the week. The Calls are just "in-the-money" and the Puts are just slightly "out-of-the-money".The cost to play the upside with one week options almost equals what it costs to play the downside. That's kind of strange as usually the Calls cost more to purchase than the Puts. Both are super expensive however Caterpillar as of late can jump $15.00 or $20.00 dollars in one day. When I say super expensive what do I mean? 2,690 means $2,690 Americian per contract. That is not chump change. You would have to have a very strong conviction it was going to move one way or another before you would want to jump in. Yet there is bigger problem. The current price of the stock is in a nose bleeding territory. Look at it's one year chart. Is it really doing that great? Aren't raw material costs are skyrocketing?
There are naysayers. Yet before we talk about what they are saying I should mention that there are also numerous other stocks in these nose bleeding territories. Have you watched the bank stocks lately? Now look at these numbers. With numbers like this why has the stock doubled in price? Could things start to go wrong? Are profit margins starting to get squeezed?
Now a reflection on what happened in the first quarter. Here are some remarks posted by Caterpillar back on Januarry 29th about their previous quarters operating results.
What do I make of all this? I think just stay away. Caterpillar Calls in the recent past have paid off nicely. The now current reality is that if Caterpillar starts to go sideways this week the lofty premiums built into these two series of Call options could dry up to half their current value. Why do you need to take on such risk? You don't. Let's follow this situation and see what happens. It's to dangerous for me. ** Here is how Caterpillar traded on the week.
Can you see the $40.00 two day price increase in the middle of the week? It is this kind of action that makes these options so expensive. * A Monday morning update.
Now Tuesday April 28th.
Both the Calls and Puts are commanding high premiums and retail traders are not participating in this action. Here now is Caterpillars ninety day chart. There appears to be some profit taking happening.
Let's look at the 800 series of Puts. With only three days of trading life left in them this would be a very dangerous trade to be entering into. That plus Tuesdays going into Wednesdays are not my favorite time to be looking at three day left to expiring options.
Read my Jan 13th 2026 blog "Caterpillar Calls" Rock. I talks about Caterpillar which dip for only very short periods of time. Now Wednesday at the close.
Now at look at the 800 Puts. They closed at $16.40 on the previous day. With only two days of trading life in them I would just get out. The stock dropped on the day $7.40 on the Puts barely moved! The time value in these Puts vanished.
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