Trading Option Greeks: How Time, Volatility, and Other Pricing Factors Drive Profit (Bloomberg Financial) Hardcover – June 1, 2008
|New from||Used from|
There is a newer edition of this item:
Enter your mobile number or email address below and we'll send you a link to download the free Kindle App. Then you can start reading Kindle books on your smartphone, tablet, or computer - no Kindle device required.
To get the free app, enter your mobile phone number.
“A must-read for individuals who are serious about trading options.”—James Bittman, author, "Trading Options as a Professional"
“Dan’s book is a primer for options aficionados. Without bogging you down
with super-heavy math, he walks you through the key principles and shows you
what matters the most to your trading portfolio."—Fari Hamzei, founder, Hamzei Analytics, LLC
Author, Trading Options as a Professional
"Dan's book is a primer for options aficionados. Without bogging you down with super-heavy math, he walks you through the key principles and shows you what matters the most to your trading portfolio."
Founder, Hamzei Analytics, LLC
- Publisher : Bloomberg Press; 1st edition (June 1, 2008)
- Language : English
- Hardcover : 352 pages
- ISBN-10 : 157660246X
- ISBN-13 : 978-1576602461
- Item Weight : 1.45 pounds
- Dimensions : 6.3 x 1 x 9.32 inches
- Customer Reviews:
Top reviews from the United States
There was a problem filtering reviews right now. Please try again later.
It's the only book I've read that discusses when the time value (at what point during the day and week) time value comes out of an option.
We've all seen the time premium accelerating decay graph a million times. Did you know it's only valid for ATM options? This book is the only source (book, Webcast, seminar) that I've encountered that points this out. OTM options have a more linear time decay (page 41). Very valuable info for us sellers who were holding onto short positions for the expected big pay off during the week of expiration.
FYI, the author recently (5/2011) did a live educational Webcast on the CBOE's Web site on the greeks and adjusting iron condors that I found very informative. It should be in the CBOE Webcast archives (under the Education tab) by the time you read this.
It gets into the nitty gritty of the components of the Black Scholes option pricing model.
It explains why each component is important and when, as well as, how, they affect each other.
Read this book with a white board handy because you will need to draw diagrams to fully understand it.
As a long-term trader (and presenter) of options I've read mostly all of the serious options books that would be used as teaching resources. Whilst Natenberg, McMillan, Hull et al are all good there is something particularly honest about this book in it's style: the humor with which the topics are presented. The author carefully explains the greeks over dozens of pages with excellent examples then goes back over the elements of an option's price when a particular strategy is used. He derives and explains the changes as the underlying changes. His description rivals the computer-generated pay-offs. Excellent!
For a while now I have run courses in advanced retail trading (no, that's not a contradiction) but in these elite courses I teach strategies without using the words 'Put' or 'Call'. I'll just use expressions like long delta etc. as, in the end, all options trades are an arrangement of the greeks. Once that is understood positions can be conceptionalised instantly and a trader's probability of success shyrockets. Ultimately this is where this book takes us.
This book is a good introduction to trading by understanding the greeks and, yes, the author uses strategies with puts and calls.
Incidentally buying a good book is, essentially, a low long delta position with very low theta. Gamma this one to your success. But beware: the IV will keep you awake at night thinking of strategies!
Top reviews from other countries
It would help if there were more graphs.