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Showing posts with label trading. Show all posts
Showing posts with label trading. Show all posts
Sunday, September 18, 2011
Saturday, September 3, 2011
Options Made Easy: Your Guide to Profitable Trading (2nd Edition)
“Guy Cohen cuts through the fog and helps all levels of investors grasp the most intricate concepts. He does so with great clarity and brevity despite covering such a broad set of topics. His is an invaluable guide for the interested beginner and the most advanced trader.”
—Ned Bennett, CEO, optionsXpress, Inc.
"The best book on options I have ever come across."
—Alpesh B. Patel, bestselling author of Trading Online and Mind of a Trader
"Guy Cohen really does make options easy. Each options strategy has both a visual diagram of the risk and reward, as well as a logical explanation of how the strategy works. Combined with primers on fundamental and technical analysis, Guy shows you how to put the odds in your favor in today's options markets."
—Price Headley, Founder, BigTrends.com and author of Big Trends in Trading
"Guy Cohen has put together a comprehensive, easy to understand, must-read on options for investors of all levels. Practical in its approach, the graphics bring clarity to what beginning investors might consider complicated strategies."
—Joseph Sellitto, Director Retail Derivatives, E*TRADE Securities LLC
"This is one of the best books on option strategies I have ever read."
—Daniel J. Zanger, President, Chartpattern.com
"Guy Cohen builds a foundation for the reader with simple definitions and clear mechanics on what can be a complicated topic. He then approaches each strategy with a context of fundamental and technical analysis and sets the stage for a solid understanding of risk, reward and probability."
—Dave Whitmore, Managing Director, Products & Services, Ameritrade, Inc.
In Options Made Easy, Second Edition, Guy Cohen clearly explains everything you need to know about options in plain English so that you can start trading fast and make consistent profits in any market, bull or bear!
Simply and clearly, the author reveals secrets of options trading that were formerly limited to elite professionals—and exposes the dangerous myths that keep investors from profiting.
As you set out on your options journey, you'll learn interactively through real-life examples, anecdotes, case studies, and pictures. Guy Cohen is your friendly expert guide, helping you pick the right stocks, learn the right strategies, create the trading plans that work, and master the psychology of the winning trader.
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Master all the essentials—and put them to work
Options demystified so that you can get past the fear and start profiting!
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Learn the safest ways to trade options
Identify high-probability trades that lead to consistent profits
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Design a winning Trading Plan—and stick to it
Understand your risk profile and discover exactly when to enter and exit your trades
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Choose the right stocks for maximum profit
Screen for your best opportunities—stocks that are moving—or are about to move
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Discover the optimum strategies for you
Match your trading strategies to your personal investment goals
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No bull! The realities and myths of the markets
What you must know about fundamental and technical analysis
The easy, plain-English guide to making consistent profits with options!
Teaches all the essentials with real-life examples and crystal-clear explanations
No complicated math or confusing jargon: Learn visually with easy-to-understand pictures!
Identify high-probability trades, and design a Trading Plan that works
Master practical, easy strategies for succeeding in any environment—even bear markets
Updated for today's markets with even more dynamic graphics, intuitive explanations, and valuable information!
For every investor interested in trading options
When you read this book, you'll be amazed how quickly you understand options—and how quickly you can start profiting from them!
© Copyright Pearson Education. All rights reserved.
Price: $29.99
Friday, September 2, 2011
The Bible of Options Strategies: The Definitive Guide for Practical Trading Strategies
"Guy Cohen is the master when it comes to taming the complexities of options. From buying calls and puts to iron butterflies and condors, Guy explains these strategies in a clear and concise manner that options traders of any level can understand. His chapter on options and taxes is especially welcomed (and needed). The Bible of Options Strategies is a straightforward, easy-to-use reference work that should occupy a space on any options trader's bookshelf."
–Bernie Schaeffer, Chairman and CEO, Schaeffer's Investment Research, Inc.
"The author delivers clarity, insight and perception making learning about options a joy, and practicing the art of making money that much easier: truly a bible from a guru."
–Alpesh B. Patel, Author and Financial Times Columnist
"Guy Cohen truly makes learning about options easy in this fact-filled guide. Bullet points make for a quick and enlightened read, getting to the heart of what you really need to know about each options strategy. This book is a must for any serious trader's library."
–Price Headley, Founder, BigTrends.com
Pick the right options strategies...implement them step-by-step...maximize your profits!
Introducing today's first and only comprehensive reference to contemporary options trading!
OptionEasy creator Guy Cohen identifies today's popular strategies...and tells you exactly how and when to use each one and what hazards to look out for! It's all here....
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Basic Strategies including
Buying and shorting shares, calls, and puts.
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Income Strategies including
Covered Call, Naked Put, Bull Put Spread, Bear Call Spread, Long Iron Butterfly, Long Iron Condor, Calendar Call, Diagonal Call...
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Vertical Spreads including
Bull Call Spread, Bull Put Spread, Bear Call Spread, Bear Put Spread, Ladders...
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Volatility Strategies including
Straddle, Strangle, Guts, Short Butterflies, Short Condors...
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Sideways Strategies including
Short Straddle, Short Strangle, Short Guts, Long Butterflies, Long Condors...
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Leveraged Strategies including
Call Ratio Backspread, Put Ratio Backspread, Ratio Spreads...
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Synthetic Strategies including
Collar, Synthetic Call, Synthetic Put, Synthetic Straddles, Synthetic Futures, Combos, Box Spread...
...and many more strategies...
Plus essential tax-saving information, and more!
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No other book presents this much authoritative, current information on options trading strategies
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Covers all of today's best income, volatility, leveraged, synthetic, and sideways market strategies
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Discover why each strategy works, when it's appropriate, and how to use it—step by step
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Includes a full chapter on tax issues associated with options strategies
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By Guy Cohen, whose OptionEasy application has helped thousands of traders achieve breakthrough results!
The Bible of Options Strategies is the definitive reference to contemporary options trading: the one book you need by your side whenever you trade.
Options expert Guy Cohen systematically presents today's most effective strategies for trading options: how and why they work, when they're appropriate, when they're inappropriate, and how to use each one responsibly and with confidence. The only reference of its kind, this book will help you identify and implement the optimal strategy for every opportunity, trading environment, and goal.
© Copyright Pearson Education. All rights reserved.
Price: $64.99
Friday, August 19, 2011
Option Spread Strategies: Trading Up, Down, and Sideways Markets (Bloomberg Financial)
Spread trading—trading complex, multi-leg structures--is the new frontier for the individual options trader. This book covers spread strategies, both of the limited-risk and unlimited-risk varieties, and how and when to use them.All eight of the multi-leg strategies are here: the covered-write, verticals, collars and reverse-collars, straddles and strangles, butterflies, calendar spreads, ratio spreads, and backspreads. Vocabulary, exercises and quizzes are included throughout the book to reinforce lessons.
Saliba, Corona, and Johnson are the authors of Option Strategies for Directionless Markets.
Price: $39.95
Tuesday, July 12, 2011
Monday, July 11, 2011
Thursday, July 7, 2011
Wednesday, July 6, 2011
Swing Trading 101
Discover The Astonishing Swing Trading Secrets That Are Guaranteed To Send Your Investment Profits Skyrocketing!
Check it out!
Tuesday, July 5, 2011
Monday, July 4, 2011
Sunday, July 3, 2011
Wednesday, June 22, 2011
7 Reasons Investors Should Trade Options
7 Reasons Investors Should Trade Options
Author:Equity Scholar
If you are a typical stock market investor, you adopted a buy and hold philosophy and own stocks or mutual funds. If you are a hand-on investor, you do research and carefully select stocks to own. It\'s difficult to beat the market, and most professional money managers cannot do it.
Historically, stock market investing has worked out well. But that provides no comfort for those currently invested. The market recently traded at 12-year lows, and even more frightening is the idea that many investors lost half their assets over the past year.
Why did so many people watch their investments shrink in value and do nothing?
That\'s a difficult question. Investors tend to be long. They own stocks. They don\'t know how to hedge, or reduce the risk of owning, investments. That\'s why options are so important. To me, it\'s a crime that so few stockbrokers help clients to adopt risk-reducing strategies.
Here are 7 great reasons why you should take time to learn how options work:
1.Hedging - Options allow you to reduce the risk of investing in the stock market. Imagine how investors everywhere would feel if they learned that the giant losses they suffered were unnecessary. By using appropriate strategies, those losses could have been trimmed by 50 to 90
2.Insurance - You can buy insurance that protects the value of your portfolio - just as you buy insurance to protect the value of your home or car. This insurance is expensive, but there are strategies that allow you to own insurance for little, or no, cost.
3.Income - By selling someone else the right to buy your stock at a predetermined price, you are paid a premium that you can consider to be a special dividend.
4.Leverage - You never have to trade a share of stock, and invest far less money than stockholders.
5.No Need to Always Be Bullish - Options allow you to create positions that prosper when the market moves higher, lower, or trades in a range. Traditional investors only prosper when stocks move higher.
6.Limited risk - You can adopt strategies with limited loss, but with high probability of success. The trade off is that profits are also limited. The limited loss nature of so many option strategies is the single factor that makes them so attractive, in my opinion.
7.Indexing - If you prefer to trade a diversified portfolio rather than individual stocks, the major indexes (e.g., S&P 500, DJIA, Russell 2000, etc) have options you can trade.
Disciplined trading
The Equity Scholar Team
Article Source: http://www.articlesbase.com/wealth-building-articles/7-reasons-investors-should-trade-options-4928611.html
About the AuthorEquity Scholar is a market-leading educational service for traders and investors alike. Built to be the best, Equity Scholar offers a full range of educational products and services that provide lifelong learning and support to those seeking improvement in their trading and investing performance.
Our online courses on Equities, Investing, Options, and Forex combine innovative technology with comprehensive trading and investing strategies designed to improve traders of all experience levels. With in-depth classes, live trader chat rooms, and top-rated customer support, Equity Scholar is on a mission to provide our members the best brand in educated trading and investing.
Sunday, June 12, 2011
Futures Option Spreads - Delta Neutral Trading
Futures Option Spreads - Delta Neutral Trading
There are many ways to trade futures option spreads. One way is to trade spreads that can profit from time decay. You can sell options which you believe will lose more time value than the options you buy.
Another way is to buy and sell options based on their deltas. Some of these trades are called delta neutral trades. Delta neutral trades are option trades in which the total delta of all the options is Zero. At the money options have a delta of 50.
If you buy an at the money call, you will have a delta of +50.
If you sell an at the money call, you will have a delta of -50.
If you buy an at the money put, you will have a delta of -50.
If you sell an at the money put, you will have a delta of +50.
Basically, the deltas will be determined by where you want the market to go. Think of it this way: If you sold an at the money call option, where would you want the market to move to? You would like it to go lower. So, you would have a delta of -50.
If you look at most at the money options, you will find that they are usually not at 50. That is because they are not exactly at the money. We still refer to these as the at the money options because they are the ones that are the closest to being there. It might have a delta of 47 or 53.
If you purchased one at the money call and one at the money put, you would be delta neutral. The call will have +50 deltas and the put will have -50 deltas. The total is zero. This is a very simple delta neutral trade.
Another delta neutral trade is a ratio back spread. An example of this trade would be to sell an option that is at the money and buy a greater number of out of the money options. You might sell one call option at the money (delta -50) and buy 2 call options out of the money (delta +25 each). You would be delta neutral. You would want to put this on for a credit or at even. You can also put it on for a debit but then you would care a little about market direction.
If you put it on for a credit or even money and the market was lower at expiration of the options, you would break even or earn a small credit. If you put it on for a debit, you would lose the debit amount if the market was lower at expiration of the options. In either case, if the market went sharply higher, you have a chance for unlimited profit, because you have purchased more options than you sold.
Most traders teach that ratio back spreads should be done in the far months only. This is because you have more time to be correct with a big move. The problem that I have found is that you are giving up too much for the time advantage. The options you buy out of the money are not priced at an advantage compared to the ones at the money. You can look at the theta to see how much each option will lose per day or per week.
You can also see that in order to have a lot of time left in the trade, the difference in strike prices between the option you sell and the options you buy are too much. It will take a bigger move before you have unlimited profit potential.
If you are expecting a big move, think differently than the norm and start to look at options that have 20 -40 days left. The options you buy compared to the options you sell, should be priced better. Everything is in relation to something else.
So the next time you hear someone recommending the same old ratio back spreads, take a look at the difference months to see where the real advantage is.
For more information on these non-directional option techniques, click below:
Click Here!
There are many ways to trade futures option spreads. One way is to trade spreads that can profit from time decay. You can sell options which you believe will lose more time value than the options you buy.
Another way is to buy and sell options based on their deltas. Some of these trades are called delta neutral trades. Delta neutral trades are option trades in which the total delta of all the options is Zero. At the money options have a delta of 50.
If you buy an at the money call, you will have a delta of +50.
If you sell an at the money call, you will have a delta of -50.
If you buy an at the money put, you will have a delta of -50.
If you sell an at the money put, you will have a delta of +50.
Basically, the deltas will be determined by where you want the market to go. Think of it this way: If you sold an at the money call option, where would you want the market to move to? You would like it to go lower. So, you would have a delta of -50.
If you look at most at the money options, you will find that they are usually not at 50. That is because they are not exactly at the money. We still refer to these as the at the money options because they are the ones that are the closest to being there. It might have a delta of 47 or 53.
If you purchased one at the money call and one at the money put, you would be delta neutral. The call will have +50 deltas and the put will have -50 deltas. The total is zero. This is a very simple delta neutral trade.
Another delta neutral trade is a ratio back spread. An example of this trade would be to sell an option that is at the money and buy a greater number of out of the money options. You might sell one call option at the money (delta -50) and buy 2 call options out of the money (delta +25 each). You would be delta neutral. You would want to put this on for a credit or at even. You can also put it on for a debit but then you would care a little about market direction.
If you put it on for a credit or even money and the market was lower at expiration of the options, you would break even or earn a small credit. If you put it on for a debit, you would lose the debit amount if the market was lower at expiration of the options. In either case, if the market went sharply higher, you have a chance for unlimited profit, because you have purchased more options than you sold.
Most traders teach that ratio back spreads should be done in the far months only. This is because you have more time to be correct with a big move. The problem that I have found is that you are giving up too much for the time advantage. The options you buy out of the money are not priced at an advantage compared to the ones at the money. You can look at the theta to see how much each option will lose per day or per week.
You can also see that in order to have a lot of time left in the trade, the difference in strike prices between the option you sell and the options you buy are too much. It will take a bigger move before you have unlimited profit potential.
If you are expecting a big move, think differently than the norm and start to look at options that have 20 -40 days left. The options you buy compared to the options you sell, should be priced better. Everything is in relation to something else.
So the next time you hear someone recommending the same old ratio back spreads, take a look at the difference months to see where the real advantage is.
For more information on these non-directional option techniques, click below:
Click Here!
Tuesday, June 7, 2011
How to get margin of safety with Commodities.
How to get margin of safety with Commodities.
According to Warren Buffet "Margin of Safety" are the three most important words in investment. This concept is also the corner stone of the philosophy that Benjamin Graham taught.
To get an answer of what margin of safety would mean in terms of investing in commodities , we need to be able to value a commodity relative to it's price. The lower the price in relation to the value, the higher the margin of safety. Commodities are also non-income producing assets, in fact there is a cost to carry the commodity. This cost is made up by the cost of money as well as the storage cost of the relevant commodity. The prudent commodity investor should thus factor in this cost when calculating value and should be more conservative in valuation to increase the safety margin.
How do we value a commodity? A whole book can be written about the valuation methods for commodities but we will try to capture a few key concepts.
- Production cost
This is the cost of producing the commodity. In the case of grains that will be the cost to produce per bushel. Unfortunately this is a difficult calculation at the best of times.. Sources to get this information would government agencies such as the US Department of Agriculture or the US Department of Energy.
-Producer break-even
This is the price under which some producers will start losing money. If this situation continue for too long, producers will have to stop producing or go insolvent. This method is handy when looking at metals or other commodities that are mined. Sources for information are the corporate reports of mining companies.
Supply/ Demand Ratios
- This method is widely used to determine a relative value number. This method should be used conservatively though, especially when a commodity is priced above production cost. The price might already factor in low supply/demand ratio.
So, this is a mine-field and the best approach is to be as conservative as possible in valuation. As a rule of thumb: If we are close or under production cost, producers are not making money or going out of business and prices have been depressed for a long time, the case for a value investment could be made..
According to Warren Buffet "Margin of Safety" are the three most important words in investment. This concept is also the corner stone of the philosophy that Benjamin Graham taught.
To get an answer of what margin of safety would mean in terms of investing in commodities , we need to be able to value a commodity relative to it's price. The lower the price in relation to the value, the higher the margin of safety. Commodities are also non-income producing assets, in fact there is a cost to carry the commodity. This cost is made up by the cost of money as well as the storage cost of the relevant commodity. The prudent commodity investor should thus factor in this cost when calculating value and should be more conservative in valuation to increase the safety margin.
How do we value a commodity? A whole book can be written about the valuation methods for commodities but we will try to capture a few key concepts.
- Production cost
This is the cost of producing the commodity. In the case of grains that will be the cost to produce per bushel. Unfortunately this is a difficult calculation at the best of times.. Sources to get this information would government agencies such as the US Department of Agriculture or the US Department of Energy.
-Producer break-even
This is the price under which some producers will start losing money. If this situation continue for too long, producers will have to stop producing or go insolvent. This method is handy when looking at metals or other commodities that are mined. Sources for information are the corporate reports of mining companies.
Supply/ Demand Ratios
- This method is widely used to determine a relative value number. This method should be used conservatively though, especially when a commodity is priced above production cost. The price might already factor in low supply/demand ratio.
So, this is a mine-field and the best approach is to be as conservative as possible in valuation. As a rule of thumb: If we are close or under production cost, producers are not making money or going out of business and prices have been depressed for a long time, the case for a value investment could be made..
Tuesday, May 24, 2011
How to get Margin of Safety with commodities- NB
How to get margin of safety with Commodities.
According to Warren Buffet "Margin of Safety" are the three most important words in investment. This concept is also the corner stone of the philosophy that Benjamin Graham taught.
To get an answer of what margin of safety would mean in terms of investing in commodities , we need to be able to value a commodity relative to it's price. The lower the price in relation to the value, the higher the margin of safety. Commodities are also non-income producing assets, in fact there is a cost to carry the commodity. This cost is made up by the cost of money as well as the storage cost of the relevant commodity. The prudent commodity investor should thus factor in this cost when calculating value and should be more conservative in valuation to increase the safety margin.
How do we value a commodity? A whole book can be written about the valuation methods for commodities but we will try to capture a few key concepts.
- Production cost
This is the cost of producing the commodity. In the case of grains that will be the cost to produce per bushel. Unfortunately this is a difficult calculation at the best of times.. Sources to get this information would government agencies such as the US Department of Agriculture or the US Department of Energy.
-Producer break-even
This is the price under which some producers will start losing money. If this situation continue for too long, producers will have to stop producing or go insolvent. This method is handy when looking at metals or other commodities that are mined. Sources for information are the corporate reports of mining companies.
Supply/ Demand Ratios
- This method is widely used to determine a relative value number. This method should be used conservatively though, especially when a commodity is priced above production cost. The price might already factor in low supply/demand ratio.
So, this is a mine-field and the best approach is to be as conservative as possible in valuation. As a rule of thumb: If we are close or under production cost, producers are not making money or going out of business and prices have been depressed for a long time, the case for a value investment could be made..
According to Warren Buffet "Margin of Safety" are the three most important words in investment. This concept is also the corner stone of the philosophy that Benjamin Graham taught.
To get an answer of what margin of safety would mean in terms of investing in commodities , we need to be able to value a commodity relative to it's price. The lower the price in relation to the value, the higher the margin of safety. Commodities are also non-income producing assets, in fact there is a cost to carry the commodity. This cost is made up by the cost of money as well as the storage cost of the relevant commodity. The prudent commodity investor should thus factor in this cost when calculating value and should be more conservative in valuation to increase the safety margin.
How do we value a commodity? A whole book can be written about the valuation methods for commodities but we will try to capture a few key concepts.
- Production cost
This is the cost of producing the commodity. In the case of grains that will be the cost to produce per bushel. Unfortunately this is a difficult calculation at the best of times.. Sources to get this information would government agencies such as the US Department of Agriculture or the US Department of Energy.
-Producer break-even
This is the price under which some producers will start losing money. If this situation continue for too long, producers will have to stop producing or go insolvent. This method is handy when looking at metals or other commodities that are mined. Sources for information are the corporate reports of mining companies.
Supply/ Demand Ratios
- This method is widely used to determine a relative value number. This method should be used conservatively though, especially when a commodity is priced above production cost. The price might already factor in low supply/demand ratio.
So, this is a mine-field and the best approach is to be as conservative as possible in valuation. As a rule of thumb: If we are close or under production cost, producers are not making money or going out of business and prices have been depressed for a long time, the case for a value investment could be made..
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