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Options Action: Cummins

With shares of Cummins engine about 15% lower over the past 3 months, how should you game this stock?

Although the company recently raised its outlook citing strong demand for its products, the outlook for global growth remains murky at best.

And that environment of uncertainty is precisely the reason why Mike Khouw of Cantor Fitzgerald suggests trading Cummins with options – to limit your risk.

Check out his trade. Watch the video now!







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Trader disclosure: On Sep 29, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders;Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Terranova is long VRTS; Terranova is long OXY; Terranova is long HOS; Terranova is long OIH; Terranova is long CVI; Terranova is long AXP; Terranova is long EMC; Terranova is long F; Terranova is long AMZN; Terranova is long WFC; Terranova is long AAPL; Terranova is long IBM; Terranova is long Silver puts; Terranova is long PCP; Terranova is long MS; Terranova is long GS; Terranova is long WFM

JAMES WEST
West owns gold bullion trusts, gold coins, and is a stakeholder in some gold mines.

KEVIN SMITH
No disclosures

ROMIT SHAH
Nomura Securities International Inc. makes a market in (AMD) securities

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