Put Option Strategies for Smarter Trading: How to Protect and Build Capital in Turbulent Markets
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Put Option Strategies for Smarter Trading explains all the put-based strategies in detail and shows how even a troubled market presents great opportunities to keep you in control. The worst aspect of volatile markets is a sense of not having control over events, and puts can be used to offset this apprehension. You have probably heard that astute traders can earn profits in all types of markets. Puts are among the best devices to accomplish that goal.
Introduction:
A put is an option designed to increase in value when the underlying security’s value falls. It is the opposite of a call, which is better known as an instrument that tracks a stock’s value and rises when the stock’s price rises. Traders often overlook put options because so many are naturally optimistic by nature.
It is a common pitfall to believe that a stock’s value is always going to rise, and many investors treat their purchase price as a starting point from which values can only increase as time goes by. But anyone who was invested in the markets in 2008 and 2009 knows that this belief is flawed and also that it has expensive consequences.
Stocks do fall in value. And when they do, it often defies logic. In 2008, rapid declines in stocks once thought to be invincible made the point that markets overreact. By the end of 2008, many stocks were available at bargain prices, but panic and fear were so widespread that few investors were brave enough to put capital into the equity markets. This is the perfect market for option trading—and for a number of reasons.
Contents:
- THE FLEXIBLE NATURE OF OPTIONS: RISKS FOR ALL LEVELS
- PUTS, THE OTHER OPTIONS: THE OVERLOOKED RISK HEDGE
- PROFIT-TAKING WITHOUT SELLING STOCK: AN ELEGANT SOLUTION
- SWING TRADING WITH PUTS: LONG AND SHORT OR COMBINED WITH CALLS
- PUT STRATEGIES FOR SPREADS: HEDGING FOR PROFIT
- PUT STRATEGIES FOR STRADDLES: PROFITS IN EITHER DIRECTION
- PUTS IN THE RATIO SPREAD: ALTERING THE BALANCE
- PUTS AS PART OF SYNTHETIC STRATEGIES: PLAYING STOCKS WITHOUT THE RISK
- PUTS IN CONTRARY PRICE RUN-UPS: SAFE COUNTERPLAYS DURING BEAR MARKETS
- UNCOVERED PUTS TO CREATE CASH FLOW: RISING MARKETS AND REVERSAL PATTERNS
Put Option Strategies for Smarter Trading: How to Protect and Build Capital in Turbulent Markets By Michael C. Thomsett pdf
| Author(s) | |
|---|---|
| Pages | 235 |
| Format | |
| Publication Year | 2010 |
7 reviews for Put Option Strategies for Smarter Trading: How to Protect and Build Capital in Turbulent Markets
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Amos McDaniel (verified owner) –
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.”
Wesson Bradshaw (verified owner) –
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 in profits and limit losses in volatile stock markets.”
Angelo Garcia (verified owner) –
Someone should have reviewed the draft before publishing it (says call when the author meant put, bull when the author meant bear, etc.). It is a good read for beginner and intermediate level options traders. Elaboration on the strategies would have been useful (better explanation of when a particular strategy should be used, stronger arguments, for entry and exist, are needed). Chapter that explained swing trading with options was one of the best things about the book. Overall, the book defines the usage of puts in a clear way.
Travis Tapia (verified owner) –
It was OK
Dahlia Trejo (verified owner) –
Excellent
Michaela Barrett (verified owner) –
I agree with another reader, the chapter on Swing Trading was probably the best in the book. The rest of it is repetitive and well known up to the intermediate options trader. The author does present the strategies very clearly and anyone starting out in the world of options will find the book a good read.
Ember Marks (verified owner) –
This book is very good. It takes you through every possible put option strategy and shows how it affects your profit and loss, the advantages and disadvantages of each and gives adjustments to make for each one. Love it.