Financial Times Guide to Options, 2nd Edition

Financial Times Guide to Options, 2nd Edition

by Lenny Jordan
Released November 2010
Publisher(s): Pearson Business
ISBN: 9780273736875

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Book description

The Financial Times Guide to Options, will introduce you to the instruments and markets of options, giving you the confidence to trade successfully. Options are explained in real-life terminology, using every-day examples and accessible language. Introducing three key options markets – stocks, bonds and commodities, the book explains options contracts from straight vanilla options to strangles and butterflies and covers the fundamentals of options pricing and trading   

 

Originally published as Options Plain and Simple , this new edition includes:

 

  • How the options industry operates and how basic strategies have evolved

  • Risk management and how to trade safely

  • Inclusion of new products such as exchange traded funds

  • A glossary of key words and further reading 

  • Addition of market scenarios and examples

Like all investment strategies, options offer potential return while incurring potential risk. The advantage of options trading is that risk can be managed to a greater degree than with outright buying or selling.

 

The Financial Times Guide to Options is a straightforward and practical introduction to the fundamentals of options. It includes only what is essential to basic understanding and presents options theory in conventional terms, with a minimum of jargon. This thorough guide will give you a basis from which to trade most of the options listed on most of the major exchanges.  The Financial Times Guide to Options includes:

 

  • Options in everyday life
  • The basics of calls
  • The basics of puts
  • Pricing and behaviour
  • Volatility and pricing models
  • The Greeks and risk assessment: delta
  • Gamma and theta
  • Vega
  • Call spreads and put spreads, or one by one directional spreads
  • One by two directional spreads
  • Combos and hybrid spreads for market direction
  • Volatility spreads
  • Combining straddles and strangles for reduced risk
  • Combining call spreads and put spreads
  • The covered write, the calendar spread and the diagonal spread
  • The interaction of the Greeks
  • Options performance based on cost
  • Trouble shooting and common problems
  • Volatility skews
  • Futures, synthetics and put-call parity
  • Conversions, reversals, boxes and options arbitrage

Table of contents

  1. Cover
  2. The Financial Times Guide to Options
  3. This book is dedicated to the memory of my parents
  4. Contents
  5. Preface
  6. About this book
  7. About the author
  8. Acknowledgements
  9. Introduction
  10. Part 1 Options fundamentals
    1. Introduction
    2. The basics of calls (1/2)
    3. The basics of calls (2/2)
    4. The basics of puts (1/2)
    5. The basics of puts (2/2)
    6. Pricing and behaviour (1/3)
    7. Pricing and behaviour (2/3)
    8. Pricing and behaviour (3/3)
    9. Volatility and pricing models (1/2)
    10. Volatility and pricing models (2/2)
    11. The Greeks and risk assessment: delta (1/2)
    12. The Greeks and risk assessment: delta (2/2)
    13. Gamma and theta (1/2)
    14. Gamma and theta (2/2)
    15. Vega
  11. Part 2 Options spreads
    1. Introduction
    2. Call spreads and put spreads, or one by one directional spreads (1/3)
    3. Call spreads and put spreads, or one by one directional spreads (2/3)
    4. Call spreads and put spreads, or one by one directional spreads (3/3)
    5. One by two directional spreads (1/4)
    6. One by two directional spreads (2/4)
    7. One by two directional spreads (3/4)
    8. One by two directional spreads (4/4)
    9. Combos and hybrid spreads for market direction (1/2)
    10. Combos and hybrid spreads for market direction (2/2)
    11. Volatility spreads (1/3)
    12. Volatility spreads (2/3)
    13. Volatility spreads (3/3)
    14. Iron butterflies and iron condors: combining straddles and strangles for reduced risk (1/2)
    15. Iron butterflies and iron condors: combining straddles and strangles for reduced risk (2/2)
    16. Butterflies and condors: combining call spreads and put spreads (1/4)
    17. Butterflies and condors: combining call spreads and put spreads (2/4)
    18. Butterflies and condors: combining call spreads and put spreads (3/4)
    19. Butterflies and condors: combining call spreads and put spreads (4/4)
    20. The covered write, the calendar spread and the diagonal spread (1/2)
    21. The covered write, the calendar spread and the diagonal spread (2/2)
  12. Part 3 Thinking about options
    1. Introduction
    2. The interaction of the Greeks (1/3)
    3. The interaction of the Greeks (2/3)
    4. The interaction of the Greeks (3/3)
    5. The cost of the Greeks (1/2)
    6. The cost of the Greeks (2/2)
    7. Options talk 1: technical analysis and the Vix
    8. Options talk 2: trading options (1/2)
    9. Options talk 2: trading options (2/2)
    10. Options talk 3: troubleshooting and common problems (1/2)
    11. Options talk 3: troubleshooting and common problems (2/2)
    12. Volatility skews (1/4)
    13. Volatility skews (2/4)
    14. Volatility skews (3/4)
    15. Volatility skews (4/4)
  13. Part 4 Basic non-essentials
    1. Introduction
    2. Futures, synthetics and put–call parity (1/3)
    3. Futures, synthetics and put–call parity (2/3)
    4. Futures, synthetics and put–call parity (3/3)
    5. Conversions, reversals, boxes and options arbitrage (1/2)
    6. Conversions, reversals, boxes and options arbitrage (2/2)
    7. Conclusions
  14. Questions and answers (1/12)
  15. Questions and answers (2/12)
  16. Questions and answers (3/12)
  17. Questions and answers (4/12)
  18. Questions and answers (5/12)
  19. Questions and answers (6/12)
  20. Questions and answers (7/12)
  21. Questions and answers (8/12)
  22. Questions and answers (9/12)
  23. Questions and answers (10/12)
  24. Questions and answers (11/12)
  25. Questions and answers (12/12)
  26. Glossary
  27. Further reading
  28. Index (1/2)
  29. Index (2/2)

Product information

  • Title: Financial Times Guide to Options, 2nd Edition
  • Author(s): Lenny Jordan
  • Release date: November 2010
  • Publisher(s): Pearson Business
  • ISBN: 9780273736875