Understanding Options [Paperback]

Michael Sincere (Author)

Book Description

Publication Date: September 22, 2006

Did you know you can use options to make money every month or every quarter? And you can use options as insurance, for example, to protect your stock portfolio. And if, on occasion, you wanted to speculate, you could leverage your money to double or triple your profits. It will cost you a lot less than if you bought stocks. And finally, if you like to short stocks, it can be safer to use option strategies than to use the stock market. 

Speaking of safety, with most option strategies you know how much you can lose in advance. If used properly, options can be used by all investors and traders to generate income, for insurance, and to speculate. 

By the time you finish this book, you should have a good idea what options can do for you and whether you want to participate. This jargon-free book is written by Michael Sincere, the author of All About Market Indicators (McGraw-Hill, 2011) Understanding Stocks (McGraw-Hill, 2003), and Start Day Trading Now (Adams Media, 2011). 

Table of Contents

Part 1: What You Need to Know First
 
Part 2: Selling Covered Calls
 
Part 3: How to Buy Calls
 
Part 4: How to Buy Puts
 
Part 5: Advanced Options Strategies
 
Part 6: Uncommon Advice

Editorial Reviews

Review

Interview with Michael Sincere about his book, Understanding Options: 

bit.ly/D8CZG

--The Writer's Coin

Review of Understanding Options

 

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--My $10,000

Review of Understanding Options:

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--Stockinvestingsimplified

From the Author

Michael Sincere is a financial journalist and the author of several books on investing and trading including Understanding Stocks (McGraw-Hill, 2003), All About Market Indicators (McGraw-Hill, 2010), and Start Day Trading Now (Adams Media, 2011). 

He is also the author of The Last Au Pair, a fast-paced novel about the adventures of three young European women who arrive in America to become au pairs. 

You can learn more about Sincere at michaelsincere.com. 

See all Editorial Reviews

Product Details

• Paperback: 240 pages
• Publisher: McGraw-Hill; 1 edition (September 22, 2006)
• Language: English
• ISBN-10: 0071476369
• ISBN-13: 978-0071476362
• Product Dimensions: 8.5 x 5.6 x 0.6 inches
• Shipping Weight: 9.6 ounces (View shipping rates and policies)
• Average Customer Review: 4.6 out of 5 stars  See all reviews (51 customer reviews)
• Amazon Best Sellers Rank: #20,646 in Books (See Top 100 in Books)
  • #7 in Books > Business & Investing > Industries & Professions > E-commerce > Online Trading

More About the Author

Michael Sincere (www.michaelsincere.com) is the author of a number of investment and trading books, including Understanding Stocks (McGraw-Hill, 2003) the bestselling Understanding Options (McGraw-Hill, 2006), All About Market Indicators (McGraw-Hill, 2010), and Start Day Trading Now (Adams Media, 2011).

Sincere has written hundreds of columns and magazine articles on investing and trading, including a monthly column for MarketWatch called "The Rookie Trader." He has been interviewed on dozens of national radio programs and has appeared on several financial news programs such as CNBC and ABC's World News Now! to talk about his books.

Customer Reviews

Most Helpful Customer Reviews

139 of 146 people found the following review helpful:

4.0 out of 5 stars Your launching pad into the world of stock options, June 30, 2007

By 

Deron Baker "angry music fan" (Winter Park, FL) - See all my reviews
(REAL NAME)   

This review is from: Understanding Options (Paperback)

I was in the middle of writing my own book on retirement investing, which I have now finished. During that process I read many different books to get a well-around education on the subject. One area that always fascinated me - but seemed overwhelming - was the arena of stock options. I read the Futures and Options for Dummies book, only to then become more confused. I kinda gave up on the subject until I stumbled upon Michael Sincere's book in the store.

Don't let the size of the book fool you. The author packs quite a lot of information into these 221 pages. He explains the world of stock options in a very easy-to-understand format. Michael debunks many myths about options and shows you that while some types of options are highly risky, some are not.

This book is the launching pad to get you started in the world of stock options. You will eventually need to read more if you wish to purchase or sell options, but this book becomes your foundation. The nice thing about this book is that you will quickly learn whether or not options are right for you. Personally, I do not want to participate in options. However, I was able to make an informed decision based on the knowledge found in this book. I am still glad I read the book and highly recommend it to anyone who is curious about stock options.

64 of 68 people found the following review helpful:

5.0 out of 5 stars Highly Recommended !!, May 8, 2008

By 

Creed (Palm Springs, CA) - See all my reviews

This review is from: Understanding Options (Paperback)

Reading a book on Options Trading is usually a daunting task. While it is true that statistical probabilities, The Greeks and mathematically determining an overpriced or underpriced option all play a part in option trading, in the beginning, this often confuses and intimidates a novice.

Michael Sinceres' book is different. He leaves the mathematics alone. In very simple language, Sincere walks you through the four basic option trades:

1. The Covered Call.
2. Buying a Call.
3. Buying a Put.
4. Selling a Put.

What you may not know is that most brokerages will limit a beginning option traders to these 4 trades anyway.

As if he were sitting at your kitchen table, Sincere actually takes you step- by-step, through each trade. No, this is not a complete treatise on option trading but it is a very good start.

It is true that the key to option success is choosing the right underlying stock. If you have never bought a stock, his book on stock trading would be a better choice. It is also true that options are a form of gambling and anyone who says their "system" guarantees success is probably selling something very expensive.

If you have experienced trading stocks and are looking for your first option book, this would be the one I'd recommend.

76 of 82 people found the following review helpful:

2.0 out of 5 stars Great style, poor contents, December 4, 2008

By 

Paulo C. Rios Jr. (Europe) - See all my reviews
(VINE VOICE)    (REAL NAME)   

Amazon Verified Purchase

This review is from: Understanding Options (Paperback)

Most people who are familiar with stocks and have never traded options before tend to treat options like stocks. The main strategies exposed by this book are the naked purchasing and selling of options with no spread, which are the very ones that a beginner will try to use (since they seem similar to stock trading) but should not. The only exception, the covered call strategy, has a low risk but also a very low return too and doesn't protect the investor against a major contrary market movement.

One can't deny that the author's intentions seem to be the best possible. He has a friendly manner and tries to motivate the reader all the time. The writing is very pleasant. But, unfortunately, style and intentions are not substitute for a poor treatment of a subject matter.

Armed with the information from this book, the beginner will hopefully find that some key knowledge is missing. For example, the author's explanation on how to adjust a naked call that didn't go well pales in comparison with the outstanding treatment and alternatives presented by McMillan in "Options as a Strategic Investment" on the chapter on the naked purchasing of calls.

For a much better treatment and introduction than this book, try "Get Rich with Options" by Lowell. Its title could be improved, but its contents are just superb. Any comparison with this book under review is simply unfair.

As Einstein once said, "make it simple but not too simple."