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May 16, 2013  Thu 2:14 AM CT

NI: SEE CHART GET CHAIN FIND STRATEGIES
NiSource has rebounded since boosting its dividend this week, and traders are betting that the natural-gas company will hold onto those gains.

Nearly 2,000 May 30 puts were sold yesterday, most of them for $0.25, according to optionMONSTER's tracking systems. The volume was well above the strike's open interest of 318 contracts, indicating new activity.

The put sellers are looking for NI to be above $30 by expiration at the end of tomorrow's session. If it does not reach that price, the traders will face the obligation to buy shares at that level. (See our Education section)

NI is up 1.93 percent to $29.65. The stock had been drifting lower since first-quarter results were announced at the end of April, but it bounced on Tuesday when the company said it would raise its dividend by 4 percent to $0.25 per share for the second quarter.

Total option volume in the name was nearly double its daily average in the last month. Calls outnumbered puts by more than 3.5 to 1.
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Education & Strategy

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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