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• KMI 0% Rate It

One investor apparently thinks that Kinder Morgan is a solid bet at current levels.

optionMONSTER's monitoring programs detected the sale of 5,000 October 35 calls for $0.97. An equal number of September 35 calls were bought at the same time for $0.65, but volume was below open interest in those. This indicates that an existing short position was rolled forward in time.

The trader almost certainly owns shares in the Houston-based company, which transports and stores energy products including crude oil, natural gas, and coal. If the position hadn't been adjusted, he or she would have been forced to sell stock at expiration tomorrow.

The investor is now locked in for another month and collected an incremental $0.32 of premium. The trader is also collecting the 3.9 percent dividend yield, so this is probably a so-called investor who is combining stock and options to generate higher returns than are available in the bond market. (See our Education section)

KMI is down 0.63 percent to $35.72 this afternoon but has been holding its current range for the last two months. Given that the goal appears is be earning money from the passage of time , preservation of principal is crucial. So the trader probably sees little downside risk in the name.

Overall option volume is 7 times greater than average in KMI so far today.

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