Visual Guide to Options uses full-color charts and other illustrations to help readers understand the mechanics and actionable details of the marketplace and how to profit from options trading. An accessible reference volume for investment professionals of all levels of experience, the book takes a direct and to the point approach to the topic, enhanced by colorful and visually effective graphs and charts of the options market. Discussing the functions of the exchanges, how they work, and the strategies for taking advantage of the market while steering clear of risk, this is the ultimate visual guide to understanding the world of trading options.
My goal for this guide is to allow you to open to just about any point in the book and ﬁnd a usful tip, method, or actionable idea that you can apply immediately, without having to go back and read too far. Most of us believe we are free thinkers, but it’s important to realize that on some level, information ﬂows into our minds through ﬁlters or biased channels. The speciﬁc publications you read or websites you browse dictate your information sources. As you structure your investment thesis and strategy, don’t ever be afraid to break your normal pattern and look for alternative methods of gathering information, statistics, and strategy.
Depending on your particular exposure or experience with trading options, you are going to have preconceived notions about how useful they are to you. Even if you have been an extremely successful options trader, keep your mind open to looking at the option markets and their risk in a diﬀerent way. The ideas, techniques, and processes in this book are not the only solution, but they have worked for me for many years and may make a good addition to your existing repertoire. No one has “the secret sauce”; you simply need a viable action plan and a sound risk and psychological management system.
Although there is no perfect way to trade options, there are many wrong ways to do it. I learned some valuable (and costly) lessons along the way; I hope to show you where I screwed it up so that you can avoid the major pitfalls of bad options trading. This book expands on the focus of my ﬁrst book, Your Options Handbook, and details more of the nuanced techniques and analysis that professionals use to get an edge on the market. The goal of this text is to help you to truly understand risk, order ﬂow, and volume as well as execution and strategy.
- The World of Options
- Tools and Knowledge for Trading Options Professionally
- Visualizing the Greeks
- Visualizing Basic Strategies: Trading Calls and Puts
- Visualizing and Trading Vertical Spreads
- Visualizing and Trading Butterﬂies, Condors, and Complex Spreads
- Managing Your Risk: Tactics, Tips, and Volatility Tricks