If you want to participate in the remarkable rally in cattle but want to avoid going long at the potential top, consider this strangle trade. This trade profits from a large move in either direction. The trend is clearly up and to the right, but there has been a couple limit down days recently, this trade aims to capture profit from volatility, 

NOVEMBER ’25 FEEDER CATTLE

Strangle Trade 

Buy 1 November’25 340 Put 6.20

Buy 1 November’25 400 Call 3.57 ½ 

Price: 9.77 ½

Cost: $4,887.50

November’25 Feeder Cattle Options Expire 11/20/25 (83 Days) 

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK

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If you have cattle you’re looking to hedge, consider the following puts spreads:

NOVEMBER’25 FEEDER CATTLE PUT SPREADS BELOW           

Buy 1 November’25 350 Put 8.57 ½ 

Sell 1 November’25 310 Put 1.75 

NOVEMBER’25 FEEDER CATTLE 364.350

Price: 6.825     Cost: $3,412.50/Trade Package, Plus Fees and Commissions. 

November’25 Feeder Cattle Options Expire 11/20/25 (83 Days) 

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK – Potential Gain $20,000.00/Trade Package, Minus the Premium

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Buy 1 November’25 350 Put 8.57 ½ 

Sell 1 November’25 320 Put 2.20

Price: 6.37 ½      Cost: $3,187.50/Trade Package, Plus Fees and Commissions. 

November’25 Feeder Cattle Options Expire 11/20/25 (83 Days) 

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK – Potential Gain $15,000.00/Trade Package, Minus the Premium

Buy 1 November’25 350 Put 8.57 ½ 

Sell 1 November’25 330 Put 3.80

Price: 4.77 ½      Cost: $2,387.50/Trade Package, Plus Fees and Commissions. 

November’25 Feeder Cattle Options Expire 11/20/25 (83 Days) 

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK – Potential Gain $10,000.00/Trade Package, Minus the Premium

Soybean oil has been trading lower due to a lack of clarity on small refinery exemptions from the EPA. Soybean oil is potentially becoming oversold, and the oil share can continue to rise from here, especially on a longer timeframe. 

MARCH ’26 SOYBEAN OIL

Buy the March ’26 soybean oil 60 calls once the gap fills on the chart at 51.53. The 60 calls are going for 1.570. The maximum risk if you bought them now is 1.570 or $942/Trade Package, Plus Fees and Commissions.

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK – Potential Gain UNLIMITED/Trade Package, Minus the Premium

The cotton is chart is getting tight and volume is decreasing, indicating a breakout could be ahead. The August WASDE report included a 100,000 bale decrease in beginning stocks. Harvested acres were lowered by 1.3 million due to lower planted acres and increasing abandonment. Despite the 53 lbs. per acre yield increase, production was lowered 1.4 million bales to 13.21 million bales. 

MAY 26’ COTTON

Buy May ’26 Cotton 80 calls 0.85
Price:  0.85     Cost: $425/Trade Package, Plus Fees and Commissions. 

May ’26 Cotton Options Expire 4/10/26 (224 Days)

MAXIMUM LOSS: LIMITED – ZERO MARGIN RISK – Potential Gain UNLIMITED/Trade Package, Minus the Premium

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Hans Schmit, Walsh Trading

Direct 312-765-7311 Toll Free 800-993-5449

hschmit@walshtrading.com    www.walshtrading.com

Walsh Trading, Inc. is registered as a Guaranteed Introducing Broker with the Commodity Futures Trading Commission and an NFA Member.

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