The Options Trading Body of Knowledge: The Definitive Source for Information About the Options Industry
The Options Trading Body of Knowledge is designed to provide readers with a comprehensive reference for the entire options market. This book is designed for the options trader, whether a novice or skilled pro, who understands and appreciates the market issues.
The Options Trading Body of Knowledge provides a market overview and discussion of risks, in addition to a comprehensive listing of strategies. Most of these strategies are accompanied by tables and illustrations identifying profit and loss zones, as well as breakeven points. The strategy section uses companies for examples.
These are based on actual option values for three publicly listed companies; however, their names have been changed due to the ever-evolving share prices of each. All the stock prices and option premium values are based on the closing values of those stocks and options as of December 31, 2007. By using this fixed moment in time, all examples are based on the same data.
However, even though stock and option valuation changes constantly no matter when you analyze relative values, the approximate option risks and opportunities remain identical. As long as time to expiration is the same as that in the examples, and proximity between strike price and current market value remains within the same range, the values of options and the likely outcome of strategies will work in the same manner.
This book also provides a very comprehensive explanation of how option premium develops based on various elements of value; calculation of returns from options and stock trading; federal taxation works in the options market; how stocks are picked for options trading; online and print resources; and a very complete glossary of terms that options traders will find valuable.
- Market Overview
- Market Risks
- Elements of Value
- Return Calculations
- Options and Stock Selection
- Option Taxation
- Option Strategies
- Option Print Resources
- Option Glossary