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November 19, 2013  Tue 9:54 AM CT

FAST: SEE CHART GET CHAIN FIND STRATEGIES
A large trader is betting that Fastenal will see more volatility in coming months.

More than 6,300 FAST options have change hands today, 6 times its daily average for the last month. Almost all of that action is in one strike.

optionMONSTER's Heat Seeker system detected the purchase of 5,000 February 50 calls for $1.20, with prices rising in subsequent smaller prints. This is clearly a new position as previous open interest at that strike was just 1,173 contracts. (See our Education section)

Just after the calls were bought, the biggest block of FAST stock traded as 160,000 shares were sold for $46.92. The combination of sold shares and long calls creates a delta-neutral play that is long volatility.

FAST is up fractionally to $46.96 this morning. The construction-supply company bounced off support at $44 in late August and hit long-term resistance at $52 two weeks ago.
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Gamma

As we continue to discuss the Greeks, we come to the first of the strike based Greeks called Gamma. Gamma is known as the second derivative, while delta is the first.

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