Market News

October 13, 2016  Thu 7:47 AM CT

A large call roll is looking for more gains in Caterpillar.

optionMONSTER's monitoring system detected the sale of 9,300 November 77.50 calls for $10.21 and the purchase of 9,300 May 80 calls also for $10.21 yesterday. Volume was below open interest in the November contracts, indicating that a bullish in-the-money position was rolled forward by six months to a higher strike.

Long calls lock in the price where investors can buy stock, allowing them to profit from a rally with limited capital at risk. Their cheap cost can also generate significant leverage on a percentage basis if shares move in the right direction. (See our Education section)

CAT rose 0.13 percent to $87.58 yesterday and is up 10 percent in the last three months. The construction-equipment giant is scheduled to release quarterly results in pre-market hours on Oct. 25.

Overall option volume in the name was twice its daily average yesterday.

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