Options as a Strategic Investment (Hardcover)

by Lawrence G. McMillan (Author) "Each chapter in this book presents information in a logically sequential fashion..." (more)
Key Phrases: higher striking price, lower striking price, covered straddle write, Call Option Strategies, Monte Carlo, Option Price Delta (more...)

Editorial Reviews

Product Description
Reflecting today’s market realities and the new innovative options products available, this fourth edition features an in-depth analysis of volatility and volatility trading; updated information on all stock option strategies, reflecting recent market conditions; buy and sell strategies for Long Term Equity Anticipation Securities (LEAPs); detailed guidance for investing in the growing field of structured products; the latest developments in futures and futures options; and the market impact of the most recent changes in the margin rules.

Packed with graphs and charts to clarify profit and loss potential, margin requirements, and criteria for selection of a position, this classic remains an indispensable resource for investors determined to master the world of options--and profit.

From the Publisher
The options world has a lot to offer investors and traders alike, but it can be dauntingly hard to understand. Since its original publication, Options as a Strategic Investment has answered many a question; and each succeeding edition has answered many more. It is the options reference in our office.

John Bollinger, CFA, CMT, President

Bollinger Capital Management, Manhattan Beach, California Larry McMillan’s Fourth Edition of Options as a Strategic Investment is a must read. This latest version of his original classic presents his latest thinking on options. McMillan is truly the master of his field.

John Murphy, President

Murphy Morris, Inc., Dallas, Texas

Larry’s book is the bible of the options community. It has established the benchmark by which all other option books are compared - and none measure up. Alex Jacobson, Vice President International Securities Exchange, New York, New York Larry has taken options education into the 21st century with this book. His insights into trading concepts will always stand the test of time. Keeping up with the latest information on options is mandatory and no one does it more masterfully than Larry.

Mark D. Cook, Professional Options Trader

Mark D. Cook Trading Instruction, East Sparta, Ohio

The options product is the premier tool for managing risk, but most professionals are no longer taught about it, and individual investors shun it because of its supposed complexity. Mr. McMillan not only makes this risk management tool easy to understand, but fun to learn. Did you realize that if you own a car you own a put? Read the book and find out how you are already using options as a risk management tool without realizing it. This book should be read by everyone - professionals and individual investors alike. Thomas J. Dorsey, President Dorsey, Wright & Assoc., Richmond, Virginia The best one-stop source of understandable option information that you can act on immediately. Every serious investor should read this book.

Ken and Daria Dolan

Heard daily across America on the WOR radio network.

See all Editorial Reviews

Product Details

• Hardcover: 1001 pages
• Publisher: Prentice Hall Press; 4 Sub edition (April 3, 2001)
• Language: English
• ISBN-10: 0735201978
• ISBN-13: 978-0735201972
• Product Dimensions: 9.5 x 7.4 x 2.2 inches
• Shipping Weight: 3.6 pounds (View shipping rates and policies)
• Average Customer Review: 4.4 out of 5 stars See all reviews (71 customer reviews)
• Amazon.com Sales Rank: #7,861 in Books (See Bestsellers in Books)

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Customer Reviews

Most Helpful Customer Reviews

230 of 242 people found the following review helpful:

4.0 out of 5 stars Required Reading for the Options Professional!, October 24, 1999

By A Customer

This review is from: Options as a Strategic Investment, Third Edition (Hardcover)

When I began trading options on the floor of the Chicago Board Options Exchange (early 1980s) an earlier edition of this book was the most complete options reference manual available. Ditto for the current edition. I'll admit that the book is rather dry, but I am curious as to the expectations of some readers who wrote reviews. Do they need reference works to provide them with stimulating prose? If you want an options manual you will return to time and time again, buy this book. True, the bulk of the material is theoretical, but so is every options valuation model in existence. The hedge ratio of an option (delta) is theoretical too, but understanding the hedge ratio gives rise to many applications. Those of you who want interesting trading "stories" read "Reminiscences of a Stock Operator". Those who want track records read my Disclosure Document. Those who believe "striking price" is not correct terminology should call the Options Institute as some of the questions on the required entrance exam for perspective market makers at the CBOE commonly refer to "striking price". If you are looking for applications in lieu of foundational knowledge, buy a "black box" system. For those readers who want to understand options well enough to design their own trading systems, this book is the best. I will venture to guess that those critical individuals who do not want to understand the theoretical aspects of options also believe that PE ratios don't mean anything anymore. If this sounds like you, consider hiring a professional to trade for you. If not, I hope to trade with you soon.....and then we'll have lunch. Yours!

109 of 112 people found the following review helpful:

5.0 out of 5 stars The CBOE should require ALL traders to read it!, January 10, 2001

By	Rob Ryley "Robert" (Northeast NJ) - See all my reviews

This review is from: Options as a Strategic Investment, Third Edition (Hardcover)

Most people who trade either stocks, options, or futures lose money. This is because they 1) are undercapitalized, 2) have no system or 3) don't understand the instrument they trade. 4) some combination of 1, 2, and 3. This book won't help you if you don't go into the market with enough money, but it will help you develop your own system (after a lot more research) and figure out how to use options to increase returns or limit risk.

This book describes just about every fundamental strategy you could try with options. It covers the total return concept of covered call writing, the pros and cons of option buying, examines various types of spreads (vertical, calendar, and diagonal) and the various delta (price) neutral strategies.

There is some advanced math here (in an appendix), but anyone of average intelligence and stock market knowledge could follow it.

Don't pay attention to those reviewers who trash the book--they have no clue. I constantly refer to this book in order to gain a better understanding of different option strategies. No matter which direction option markets evolve, the information of this book will still apply.

68 of 68 people found the following review helpful:

5.0 out of 5 stars This is THE book., July 15, 2002

By	FreeAtLast (Newington, CT USA) - See all my reviews

Try as I might, I cannot understand the negative reviews here. This is THE book on options. McMillan writes clearly and well. There is nothing glib here -- no promises of great wealth, no hype, no pandering to fools. What is here is solid information presented well and thoroughly.

A criticism that came up more than once (copy cat reviews?) is that the book doesn't show practical stuff. What! It provides all the information that any reasonably intelligent person needs to UNDERSTAND exactly what the strategies are and when to apply them. To ask for more is to ask for easy and oversimplified answers that will part you from your money.

The book is thick. True. You don't need all that is in it. True. The book is frightening or dull or not as useful as (gimme a break!) Wade Cook!!!

Hey! It's a text book, not a novel. Wake up! You can use it to find what YOU want to know.

There is more useful information in this book than in any hustler's high-priced and hype-filled seminar. It's all you need and it's currently selling for less $. Don't get scared off by the negative reviews or you'll miss out on the most respected and best of all the many books written on options.

If you're not willing to spend $ and a little effort to learn about options, you're not likely to profit from them. Buy the book. Then, sit down and read in it to find the definitive answers to your option questions. It simply doesn't get any more accurate, any clearer, or any better.

(Oh yes, one or two reviewers suggested that the book is out of date.