Options for the Beginner and Beyond: Unlock the Opportunities and Minimize the Risks

Options for the Beginner and Beyond: Unlock the Opportunities and Minimize the Risks

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by W. Olmstead
     
 

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Master option trading strategies one step at a time! Options for the Beginner and Beyond, Second Edition teaches options through brief, carefully-paced lessons on option concepts and trading strategies, crystal-clear definitions, and plenty of real trading examples. Every lesson builds on the one preceding it, explaining options in plain English, and guiding

Overview

Master option trading strategies one step at a time! Options for the Beginner and Beyond, Second Edition teaches options through brief, carefully-paced lessons on option concepts and trading strategies, crystal-clear definitions, and plenty of real trading examples. Every lesson builds on the one preceding it, explaining options in plain English, and guiding you all the way to advanced strategies covered in no other introductory tutorial. Drawing on his extensive experience teaching options trading to beginners -- and five years editing a leading options newsletter -- W. Edward Olmstead shows how to systematically control your risk, protect your investments, and maximize your profits. This new Second Edition integrates new coverage of weekly options throughout, and presents updated tax strategies every options trader needs to know. Olmstead shows you how to do all this, and much more:

  • Select options with high profit potential
  • Enter and exit trades
  • Choose brokers
  • Work with the Greeks, risk graphs, and LEAPs
  • Use vertical, event producing, and calendar spreads
  • Trade covered calls, straddles, strangles, married puts, and collars
  • Master these and other sophisticated strategies: naked options, stock substitutes, backspreads, butteryfly spreads, iron condors, and double diagonals
  • Implement effective end-of-year tax strategies
  • Day trade indexes with options
  • Use delta-neutral trading
  • Leverage the theory of maximum pain; implied volatility, and Black-Scholes

Product Details

ISBN-13:
9780132655828
Publisher:
Pearson Education
Publication date:
12/18/2012
Sold by:
Barnes & Noble
Format:
NOOK Book
Pages:
250
File size:
3 MB

Read an Excerpt

PREFACEPREFACE

This book is intended for people who are just starting to learn about options as well as for those who want to advance their basic knowledge to a higher level. Much of the material in this book has previously appeared in a series of articles written for The Options Professor, a monthly online newsletter about options trading, published by Independent Investor, Inc., Bloomfield, Connecticut. Some of the material was originally developed by the author for a course on options pricing theory taught at Northwestern University, Evanston, Illinois.

Section I includes Chapters 1 through 9. These chapters contain fundamental information about options, mainly intended for the beginner. Those who have some experience with options may still find it worthwhile to skim through Section I to fill some gaps in their knowledge.

Section II includes Chapters 10 through 25. Each chapter in this section is devoted to a strategy that goes beyond the basic trade of owning a call or a put option. Some chapters are an advanced continuation of the strategy introduced in the preceding chapter. The advanced chapters are marked with an asterisk and can be passed over by beginners during their first reading of this book.

Section III includes Chapters 26 through 30. Each chapter in this section covers a topic that is intended for people with options experience who want to develop a broader background. All of these chapters are marked with an asterisk, so this whole section can be passed over by beginners during their first reading of this book.

The method of exposition in this book is primarily through example. The options concepts in each chapter are introduced and discussed in theform of example trades. Many of the examples are illustrated with risk graphs, which serve to reinforce the concepts of each strategy.

All of the trades presented in the book are taken from real situations, although the prices may have been altered slightly to simplify the presentation. In most of the examples, the real stock symbol has been replaced by the mythical XYZ or ZYX, so that the reader can focus on the discussion without any distraction related to an experience with the actual stock. In some examples, the real stock symbols have been used because it seemed particularly important to the discussion.

© Copyright Pearson Education. All rights reserved.

Meet the Author

W. Edward Olmstead has a B.S. from Rice University and a Ph.D from Northwestern University, where he is currently Professor of Applied Mathematics in the McCormick School of Engineering and Applied Sciences. He has received several prestigious awards for teaching excellence including an endowed chair. His teaching activities include courses that cover both the theory of options pricing and practical strategies for trading options.

In the world of finance, Dr. Olmstead has more than fifteen years of experience in the trading of options. He holds a FINRA Series 65 license along with considerable experience as an options consultant. He has written various articles on options for the online media.

Dr. Olmstead was Editor of The Options Professor newsletter published by Independent Investor, Inc. during 2003-07. His consulting activities included service as an options analyst for Spear Capital Management. He also worked on an ultra short-term trading concept for a member firm of the Chicago Mercantile Exchange. Since 2010, he has utilized a proprietary options strategy in the management of funds for a group of private clients.

For more information about Dr. Olmstead’s current options interests, go to www.olmsteadoptions.com.

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Options for the Beginner and Beyond 2.9 out of 5 based on 0 ratings. 7 reviews.
Anonymous More than 1 year ago
I would recommend it to anybody who is interested in options.
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