Option Spreads and Combination

ISBN-13: 9781118805459 / Angielski / Miękka / 2014 / 264 str.

Scott Nations

Opis

Get a handle on option spreads to hike profit and squash loss The Complete Book of Option Spreads and Combinations is the definitive educational resource and reference guide for using option spreads and other common sense option strategies. This useful guide shows readers how to select the right strategy for their market outlook and risk/reward comfort level by describing the inner workings of each strategy and how they are affected by underlying market movements, implied volatility, and time decay. Even more importantly, readers will understand where each strategy performs well, and the market conditions where each should be avoided. Once the proper strategy is selected, readers will learn how to identify the best options to use based on -moneyness- and time to expiration. The companion website features tools including an option pricing tool and implied volatility calculator to help all traders implement these concepts effectively. There are many different types of spreads, and while less risky than other option strategies in general, they are more complex, with more variables to monitor. This guide serves as a handbook for the trader wanting to exploit options to the greatest possible benefit.

• Generate monthly income by selling covered strangles
• Use call spreads to recover from a losing stock position
• Protect an existing stock position using put diagonals
• Discover the best strategies for directional market plays

Option spreads are a great tool for traders who would rather be an option seller but who need to limit their risk. The Complete Book of Option Spreads and Combinations identifies those strategies that benefit from option erosion but that limit risk. If managed properly, spreads can provide both novice and experienced investors with the potential for a large return while limiting risk. Electronic trading platforms and reduced brokerage commissions have increased option spread trading, which should occupy a spot in every savvy investor's toolkit. Comprehensive and authoritative, The Complete Book of Option Spreads and Combinations provides a valuable manual and lasting reference.

Spis treści

Foreword vii

Preface ix

Chapter 1 Not Just More or Less but Different 1

Chapter 2 Just a Little Math 15

Chapter 3 Vertical Spreads 29

Chapter 4 Covered Calls 55

Chapter 5 Covered Puts 75

Chapter 6 Calendar Spreads 93

Chapter 7 Straddles 109

Chapter 8 Strangles 125

Chapter 9 Collars 139

Chapter 10 Risk Reversal 155

Chapter 11 Butterflies 169

Chapter 12 Condors and Iron Condors 191

Chapter 13 Conversion/Reversal 209

Chapter 14 Ratio Spreads and Back Spreads 217

Chapter 15 Other Spreads and Combinations 235

About the Website 247

About the Author 248

Index 249

O autorze

SCOTT NATIONS is president and chief investment officer of NationsShares, a division of Fortress Trading Inc. Previously, Nations was head trader for Sovereign Capital and a floor trader at both the Chicago Board of Trade and the Chicago Mercantile Exchange. He appears regularly on CNBC.

Blurb

Praise for The COMPLETE BOOK of OPTION SPREADS AND COMBINATIONS

"Option spreads are a vital tool for any serious trader and Scott Nations explains how and why to use them better than anyone else. This book is a step by step guide, covering everything from the basics to more complicated strategies, and Scott′s years of experience come through in his valuable and entertaining narrative. I recommend this book to options traders of all levels, as well as to anyone interested in adding a powerful new strategy to their financial toolbox."
Jackie DeAngelis, Host of CNBC′s Futures Now

"The explosive growth of options trading among retail investors is one of the most exciting and potentially dangerous trends in the stock market. Professional investors are happy to welcome the new money because most it ends up in their pockets. Newcomers are drawn to the potentially explosive rewards, but they′ll never see those gains unless they first have a roadmap and a full grasp on how to match their strategies to their goals and risk tolerance.

Scott Nations is one of a select few voices in financial punditry with the mental horsepower to understand sophisticated strategies and clarity of voice to explain those techniques in a way readers will be able to grasp and put to work. Getting the secrets of professional traders is great but what individual investors really need to have is a grasp of the strategies that fit their needs.

Don′t try to teach yourself how to trade options on the fly. Arm yourself with as much personalized knowledge as you can get. Before you trade options invest in this book. Read it twice."
Jeff Macke, Host on Yahoo! Finance, original cast member of CNBC′s Fast Money, founder of Macke Asset Management, and a hedge fund manager