Read trading_options_for_dummies.pdf text version


More information from

Trading Options For Dummies

Description: Thinking of trading options, but not sure where to start? Trading Options For Dummies starts you from the beginning with clear, step-by-step advice on how to use top option strategies to reduce your risk while boosting your income and enlarging your retirement portfolio with index, equity, and ETF options. This plain-English guide explains the common types of options and helps you choose the right ones for your investing needs. You find out how to weigh option costs and benefits, combine options to reduce risk, and build a strategy that allows you to gain no matter what the market may bring. You'll learn the basics of market and sector analysis and what to look for when trying out a new option strategy. You'll also find what you need to know about options contract specifications and mechanics. Discover how to: -Understand option contracts and orders -Determine and manage your risk -Guard your assets using options -Trade options on securities exchanges -Protect your rights and satisfy your contract obligations -Target sectors using technical analysis -Minimize potential losses and optimize rewards -Map out your plan of attack -Limit your downside when trading the trend -Combine options to limit your position risk -Benefit from exchange traded funds -Key in on volatility for trading opportunities -Capitalize on sideways movements Trading options is serious business. Trading Options For Dummies gives you the expert help you need to succeed.


Introduction About This Book. Conventions Used in This Book What You're Not to Read Foolish Assumptions How This Book Is Organized Part I: Getting Started Part II: Evaluating Markets, Sectors, and Strategies Part III: What Every Trader Needs to Know About Options Part IV: Advanced Strategies for Option Traders Part V: The Part of Tens Glossary Icons Used in This Book Where to Go from Here Part I: Getting Started Chapter 1: Options Trading and Investing Understanding Options Knowing option essentials Gaining comfort with option mechanics Recognizing option risks and rewards. Incorporating Options into Your Routine Adding options to your analysis Trying out investing and trading strategies

Putting Options to Work. Understanding option styles Using options to limit your risk Applying options to sector approaches Using Options in Challenging Markets Reducing your directional bias Benefiting when the markets go nowhere Considering your obstacles Chapter 2: Introducing Options Understanding Option Contracts Getting a grasp on option basics Comparing options to other securities Uncovering an Option's Value . Understanding options rights and obligations. Taking in some terminology Accessing All Your Options Identifying options Expiring options gracefully Dissecting your rights Creating Contracts Opening and closing positions Selling an option you don't own Keeping Some Tips in Mind Chapter 3: Trading Places: Options for Stocks The U.SOptions Exchanges . Navigating the Markets Trade execution Option market participants Transactions unique to options Trading rules you should know Weighing Option Costs and Benefits Identifying costs unique to options Valuing options benefits Grasping Key Option Pricing Factors Introducing option Greeks Connecting past movement to the future Chapter 4: Option Risks and Rewards Understanding Your Trading Risks Risking money with stocks Calculating option risks Reaping Your Rewards Benefiting from stocks Breaking even with options Profiling Risk and Reward Profiling stock trades with risk graphs Profiling option trades with risk graphs. Combining option positions Considering the worst-case scenario Part II: Evaluating Markets, Sectors, and Strategies Chapter 5: Tapping Into the Market's Mood Assessing the Market's Bias Judging the strength of a move (Psycho)-analyzing the market Watching Call and Put Activity Understanding put-to-call ratios Using the put volume indicator Using Volatility to Measure Fear Measuring volatility

Recognizing impact from changing volatility Spelling fear the Wall Street way: V-I-X Applying Breadth and Sentiment Tools Locating neutral areas for indicators Identifying indicator extremes Chapter 6: Targeting Sectors with Technical Analysis Getting Technical with Charts Chart basics Adjusting your time horizon for the best view. Visualizing supply and demand Identifying Relatively Strong Sectors Relative ratios Rate of change indicator Using Sector Volatility Tools Displaying volatility with indicators Analyzing volatility with Bollinger bands Projecting Prices for Trading Support and resistance Trends Channels Price retracements and extensions Projections and probabilities Chapter 7: Kicking the Wheels of a New Strategy Monitoring Option Greek Changes Tracking premium measures Changing volatility and option prices Paper Trading an Approach Trading on paper: pluses and minuses Implementing electronic paper trades Using Trading Systems Knowing what you're getting Performing a backtest Adding risk management to a backtest Shifting from Knowledge to Mastery Setting the right pace Achieving mastery through longevity Chapter 8: Mapping Out Your Plan of Attack Managing Your Costs Optimizing Order Execution Understanding option orders Entering a new position Executing a quality trade Exiting an existing position Part III: What Every Trader Needs to Know About Options Chapter 9: Getting a Handle on Option Styles Nailing Down Index Options Getting to the nitty-gritty of indexes Capitalizing on an index with options Watching Out for Style Risk American-style options European-style options Exercising Your Options American Style Mechanically speaking What you see is what you get To exercise or not, that is the question Exercising Your Options the Euro Way Tracking index settlement (the "SET") Cashing in with exercise

Satisfying Option Obligations American-style stock options Expiring uninspiring options European-style options. Breaking It Down: American-Style Index Options Exercising rights Meeting obligations Chapter 10: Guarding Your Assets with Options Putting Protection on Long Stock Combining puts with long stock Weighing protection cost versus time Limiting Short Stock Risk with Calls Protecting a short stock position Further reducing short stock risk Hedging Your Bets with Options Protecting a portfolio partially Protecting a portfolio completely Avoiding Adjusted Option Risk Justifying option adjustments Adjusting from adjustments Chapter 11: Limiting Your Downside When Trading the Trend Leveraging Assets to Reduce Risk Determining your total dollars at risk Relying on market timing Combining Options to Reduce Risk Spreading the risk with a debit trade Spreading the risk with a credit trade Chapter 12: Combining Options to Limit Your Position Risk Combining Options with Stocks Creating "covered" positions. Covering the covered call position Reducing protected stock costs Varying Vertical Spreads Changing your vertical spread risk profile Spreading time with calendars . Defining diagonal spreads Chapter 13: Benefiting from Exchange-Traded Funds Introducing the Exchange-Traded Fund Comparing ETFs to Indexes Distinguishing ETF and index options Reducing Portfolio Volatility with ETFs Revisiting volatility Investing with ETFs Tilting Your Portfolio with Sector ETFs Adding sector ETFs to a portfolio Selecting the right approach Part IV: Advanced Strategies for Option Traders Chapter 14: Profiting Without a Market Outlook Limiting Directional Risk Capitalizing on a big move Reducing straddle risk & reward. Neutral View versus Neutral Position Defining a neutral approach Trading with Delta Monitoring two key Greeks Creating a delta neutral straddle. Understanding Trade Adjustments.

Deciding when to adjust a trade Deciding how to adjust a trade Chapter 15: Keying In on Volatility for Trading Opportunities Analyzing Implied Volatility Levels It's all relative When options are skewed Understanding Ratio Spreads Deciding your strategy Using Ratio Backspreads Defining ratio backspreads Spotting best conditions for ratio backspreads Chapter 16: Capitalizing When Markets Move Sideways Winning Positions in Sideways Markets Managing existing positions Option strategies for sideways moves Understanding Butterfly Positions Defining the long butterfly Digging deeper into butterfly risk Creating an iron butterfly Understanding Condor Positions Defining a condor spread Recognizing condor risks Part V: The Part of Tens Chapter 17: Ten Top Option Strategies Married Put Collar Long Put Trader LEAPS Call Investor Diagonal Spread. Bear Call Credit Spread Straddle Call Ratio Backspread Put Ratio Backspread Long Put Butterfly Chapter 18: Ten Do's and Don'ts in Options Trading Do Focus on Managing Risk Don't Avoid Losses Do Trade with Discipline Don't Expect to Remove Your Emotions Do Have a Plan Do Be Patient Don't Suffer Analysis to Paralysis Do Take Responsibility for Your Results Don't Stop Learning Do Love the Game Glossary Index


Order Online - Order by Fax - using the form below Order by Post - print the order form below and send to

Research and Markets, Guinness Centre, Taylors Lane, Dublin 8, Ireland.

Page 1 of 2 Fax Order Form

To place an order via fax simply print this form, fill in the information below and fax the completed form to 646-6071907 (from USA) or +353-1-481-1716 (from Rest of World). If you have any questions please visit

Order Information

Please verify that the product information is correct. Product Name: Web Address: Office Code: Trading Options For Dummies OC8IIIROTUSTW

Product Format

Please select the product format and quantity you require: Quantity Hard Copy: EURO 20.00 + Euro 25.00 Shipping/Handling

Contact Information

Please enter all the information below in BLOCK CAPITALS Title: First Name: Email Address: * Job Title: Organisation: Address: City: Postal / Zip Code: Country: Phone Number: Fax Number: * Please refrain from using free email accounts when ordering (e.g. Yahoo, Hotmail, AOL) Mr Mrs Dr Miss Last Name: Ms Prof

Page 2 of 2 Payment Information

Please indicate the payment method you would like to use by selecting the appropriate box. Pay by credit card: American Express Diners Club Master Card Visa Cardholder's Name Cardholder's Signature Expiry Date Card Number CVV Number Issue Date

(for Diners Club only)

Pay by check:

Please post the check, accompanied by this form, to: Research and Markets, Guinness Center, Taylors Lane, Dublin 8, Ireland. Please transfer funds to: Account number Sort code Swift code IBAN number Bank Address 833 130 83 98-53-30 ULSBIE2D IE78ULSB98533083313083 Ulster Bank, 27-35 Main Street, Blackrock, Co. Dublin, Ireland.

Pay by wire transfer:

If you have a Marketing Code please enter it below: Marketing Code: Please note that by ordering from Research and Markets you are agreeing to our Terms and Conditions at

Please fax this form to: (646) 607-1907 or (646) 964-6609 - From USA +353 1 481 1716 or +353 1 653 1571 - From Rest of World


8 pages

Report File (DMCA)

Our content is added by our users. We aim to remove reported files within 1 working day. Please use this link to notify us:

Report this file as copyright or inappropriate


You might also be interested in

Ichimoku Charts : an Introduction to Ichimoku Kinko Clouds
Ichimoku Charts : an Introduction to Ichimoku Kinko Clouds
A Study on Derivatives Market in India