Use Puts to Mitigate Risk, Reverse and Offset Losses, and Protect Profits–Even in Plummeting Markets!   “In these financial times, this is an especially timely book. Michael C. Thomsett provides practical, direct instruction to investors on how to employ put options to enhance and protect their portfolios. A powerful guide for professionals and novices alike.” –Virginia B. Gerhart, CFP, President, Gerhart Associates   “Michael C. Thomsett’s Put Option Strategies is a must read for all stock investors who want to protect profits and manage risk in volatile stock markets. This easy to read book explains the basic strategies and moves on to more sophisticated uses of put option strategies to hedge risk in bear markets. The use of leverage is clearly explained to provide the tools for conservative investors to increase their profitable trading. This book is an excellent resource for all stock investors and should be read by all investors who want to lock (more…)

Options traders make money any time the market moves, no matter whether it goes up or down. Now, with this primer created from Natenberg’s bestselling video course, Mastering Option Trading Volatility Strategies, it has never been easier for traders to gain a powerful understanding of the potential of volatility trading strategies. Since the inception of options only a few decades ago, many have sought to harness the key element of options trading volatility. No one is more synonymous with volatility trading strategies than Sheldon Natenberg. Renowned for his influence on nearly every option trader through his classic work, Option Volatility and Pricing, this legend in trading success is in great demand for his ability to harness market forces through his calculated approach to trading. Now, in a groundbreaking new approach, Natenberg personally guides you through the key elements of option valuation and volatility trading strategies. Written in an amazingly ac (more…)

Review

“An excellent guide for learning how to trade option spreads. Saliba offers in-depth discussions on how and when to employ these advanced strategies and to manage the risk of each position.” Peter LipskyTrader, Pan Capital

Saliba is back with the best option trading strategies for all markets, whether they are trending up, down, or sideways. Exercises and quizzes are included to reinforce lessons throughout the book.

See all Editorial Reviews
(more…)

Each option has a so called strike price. This is the price at which the option contract has been written. Every option has a whole series of strike prices from which you choose the one you feel is the most appropriate. Most options are written on a monthly basis, so at any one time there will be a series of options spread over several months into the future. Every option is issued with a spread of strike prices from very low to very high. The increment of the strike will vary according to the underlying value of the share. For a low value stock, the increments might be in $1 amounts, but for a higher value stock these could be $5 or $10 steps. The series of options is called an option chain, and each chain will cover several months. Some series are written quarterly and others on a monthly basis.

The strike price is normally presented in the middle column, with calls to the left hand side and puts shown on the right hand side. The first column labeled ‘symbol’ shows the unique code for that particular option. These are unique to the contract, the period and the equity, and can be found on many sites. When trading they normally appear as part of the trade – it is not something you have to remember! The next column is the ‘last’ , which displays the most recent prices which have been bid.

The bid and ask prices are simply the buying and selling prices of the premiums, with the ‘vol’ column showing the number of trades for that particular day. The final column is normally one labelled OI, which is short for ‘Open Interest’. This shows the number of contracts bought or sold and currently waiting for the expiry date.

An option is said to be ‘in the money’ if the strike price is below the market price for a call, and above the market price for a put. For example with a call if the strike price for the option was 500p and the equity was trading in the market at 550p, then this would be 50p in the money. (Remember a call increases in value as the underlying asset increases in price). With a put, this would be in the money for the same strike price if the equity was trading at 450p. These are normally highlighted in the chain to show their status. An option is ‘at the money’ if the strike price and market price are the same.

‘Out of the money’, is simply the reverse of being in the money. For example with a call, if the strike price was 500p and the equity was trading in the market at 450p, then this would be 50p out of the money. An option has intrinsic value if it is in the money and an at the money, or out of the money option, therefore has no intrinsic value.

Each chain will show the underlying equities current market value, along with the associated ticker and the number of days left until expiry.

In Trading Stock Options, experienced option trader Brian Burns, explains the basics of stock options and shows you how to trade the most successful option strategies. As you begin your journey on the option path, you’ll have the luxury of real-life trade examples to show you the way. The diagrams and charts help turn the complex world of options into easy to visualize and simple to understand strategies that even the most novice of traders can utilize. Trading Stock Options will show you how you can use options to: * Get paid to buy and sell your favorite stock * Purchase stocks for less than their current price * Buy insurance on stocks in your portfolio * Profit when stocks lose value * Perform short-term trades with less money than trading the stock From the Introduction “Through my experiences with option trading, I have tried almost every strategy I could find. In this book, I will be discussing the strategies that I use the most and feel are the bes (more…)

In Trading Stock Options, experienced option trader Brian Burns, explains the basics of stock options and shows you how to trade the most successful option strategies. As you begin your journey on the option path, you’ll have the luxury of real-life trade examples to show you the way. The diagrams and charts help turn the complex world of options into easy to visualize and simple to understand strategies that even the most novice of traders can utilize. Trading Stock Options will show you how you can use options to: * Get paid to buy and sell your favorite stock * Purchase stocks for less than their current price * Buy insurance on stocks in your portfolio * Profit when stocks lose value * Perform short-term trades with less money than trading the stock From the Introduction “Through my experiences with option trading, I have tried almost every strategy I could find. In this book, I will be discussing the strategies that I use the most and feel are the bes (more…)