Customer Reviews

Fundamentals of Options Market

5 star:		(8)
4 star:		(4)
3 star:		(0)
2 star:		(1)
1 star:		(0)

 

 

I have been trading stocks and options for 3 years and found the volatility, strategy and synthetics section excellent. I have had a hard time understanding synthetics and the idea of creating other positions and understanding the risk and rewards was very useful. I already knew all the strategies but the book went into explaining how to trade them and hedge them. The contract vs. delta neutral was very informative and practical. The simple use of calculating volatility down to the day was very useful and helps me determine option's premiums against fair value. I like the workbook feel instead of textbook feel.

Pros - Simple explanation of volatility, intro to synthetics, strategy section with how to trade the positions, great basic strategy formula section, interesting market making section, seemed more like a workbook, and a the quiz at the end of each section.

Cons - More on Synthetics, some sections a little complicated for the beginner (This book is more intermediate then basic). Would like more on pricing formulas. The position trading section needs more examples instead of just one.

Final thoughts: ... it was worth it, not too complicated, and information that you can use. At least it wasn't another one of those "get rich" day-trading books about scapling 1/8s with nothing but speculation and a lot of BS. I have enough of those books on my self, wish I could sell them. McMillan's book is the only other option book that I have found useful.

As an instructor in equity options for a major market making firm, I've been looking for an introductory text to supplement the lecture material presented in our training classes. While MacMillan and Natenberg have written great books on the topic, the former is not specific enough to our market making business and the latter is too advanced for the beginner. In looking for something in between these two fine works, someone suggested to me the Williams/Hoffman book. It has been unsatisfactory in several respects. Explanations of some concepts appear out of context with the material being covered, some others are very muddled, and some are just plain wrong. The book also suffers from a trait common to many traders-turned-authors in that while the authors may be very knowledgable about their subject they aren't very good at conveying - at least in book form - that knowledge to others. While students with previous exposure to options concepts may be able to overcome these deficiencies, I wouldn't recommend this book to the beginner. The beginner would be much better served by picking up MacMillan's timeless classic.

The authors appear to know their subject well. I would recommend this as a beginner-to-intermediate introduction to fundamentals except for the numerous errors.

Some errors are like "typos" such as 6 instead of 60, some are more serious and subtle such as specifying a call when a put was meant, and some are fundamental structural problems with the book. For example, the Quiz answers don't match the chapters to which they purportedly provide answers, and in some cases only some questions are answered anyway.

The errors are so numerous, and some of a type that they won't be caught by the average beginner, that it might be dangerous for a beginner to rely on this book as a reference or as an only introduction to options.

I'd really like to have a completely "cleaned up" copy, as I think that could make this the best introduction that I'm aware of.

There are a few other good books on the subject of options trading (most notably those written by McMillan and Natenberg) but none offers such complete knowledge combined with the real world perspective of a floor trader. All the information here is USEFUL and PRACTICAL! This is by far the best book on options trading ever written. It's a must have for any serious investor.

Mike Williams and Amy Hoffman have written a clear concise book that is the best single option book of the scores that I have read. They teach a course thru the Pacific Options Exchange that I have had the pleasure of taking. The course is excellent and the book is superb. I was asked to help them improve their course and it needed very little improvement and the book is just the best description of synthetics and the more complex strategies in easy to understand examples. Mike and Amy you really outdid yourselves on this work - you should be proud.

This book is a very good introduction to options if you are new to the stock market. It is written in a very friendly tone, easy to understand and even briefly covers the basics of fundamental and technical analysis of the underlying security. It even covers such basic things as types of orders (limit, market, stop etc.).

The book covers not only the most basic options trading strategies, but also complex strategies that combine different options and underlying securities. If you, however, need something even more advanced, like "Short Iron Butterfly", get the book "The Bible of Options Strategies: The Definitive Guide for Practical Trading Strategies" by Guy Cohen.

If you are already familiar with the stock market and just want to know about options, I can recommend "Trading Options for Dummies" by George Fontanills, which doesn't explain about the fundamental analysis or order types.

The disadvantage of this book is that an important technique of selling puts as a way of buying the underlying security is not covered in this book. If you are interested in this issue, read chapter 19 of "Options as a Strategic Investment" by Lawrence G. McMillan. Another disadvantage is that it doesn't have a single references to other books.

Finally, a book about options that is understandable and helpful. The book has been reprinted so the errors that the other readers referred to have been corrected. I loved it!

This book covers all the basics and a little beyond of option trading. Well written and organized.

...well, almost! Reading this clear and concise book makes me feel that even a math-phobe like me can master the options market! While reading the explainations of what an option is, to the lingo, to postions, I never felt that I was in over my head...or that it was written in a way that was determined to go over my head! It's simplicity was refreshing and empowering, and I find that I go back to it again and again as a reference point.

Who knew I'd ever get excited over a book about options trading?

This book is a very practical options trading book. I have read parts of this book more than once and I continue to carry the book as a reference for some of my complex trades. It is well written for a beginner and intermediate user, however a prior working knowledge of options trading gives you a definite advantage in understanding the subject.
Parts of the book will save you a lot of money if you know what you are looking for and that only comes from hands-on trading with real money. There are a few other books which have been written on trading options after this one that are worth looking at also, but I think some of them may have used this one as a template on how it should be done.