11/11/2008

After Beijing announced a $586 billion stimulus package for the Chinese economy, traders invested in Caterpillar stock at twice the normal level. According to Trade Alert, investors picked up 39,000 calls and 49,000 puts for the stock, which ended trading at $37.41. Some traders also invested in $40 calls for December, which will pay off if Caterpillar's stock rises above $42.70 by Dec. 19.

Related Summaries