Spread Trading : An Introduction to Trading Options in Nine Simple Steps

by Greg Jensen

• ISBN13: 9780470486160
• ISBN10: 0470486163
• Format: eBook
• Copyright: 2009-04-01
• Publisher: Wiley
• More Book Details
• Purchase Benefits

Summary

A proven method for making the most of optionsWhile professional investors are doing more and more in the way of options trading, nonprofessionals know little about this opportunity and the tremendous advantages it offers. This book provides readers with the basic tools to begin trading options through the best and safest method available: spread trading. With Spread Trading, Greg Jensen continues to educate individuals on the benefits of trading this way. And while most discussions about options trading do not emphasize how both parties in an options trade can come out ahead, Spread Trading takes the time to explain what it takes to profit from either side of the table.Greg Jensen is a Registered Investment Advisor and cofounder of Spread Trade Systems, an industry leader in investment education.

Table of Contents

Acknowledgments

Introduction

Understanding The Long and Short of "Call" Options In the Market.

Lon and Shorty

Let's Make a Deal

Trading Rights and Obligations

Some Key Terms . . . That Almost Make Sense!

Strike One . . .

Strike Two . . .

Time Travel

R & R and Time Travel for Lon

R & R and Time Travel for Shorty

How Lon and Shorty Came Out on their Deal

Understanding the Long and Short of "Put" Options In the Market.

Bulls, Bears, and Stags

The Put: Reaching a Different Trade of Rights and Obligations

Strike One . . .

Strike Two and Time Travel

R & R for Lon

R & R for Shorty

The Big Picture . . . So Far

How Lon and Shorty Came Out on Their Deal

Step 3

Did You Know That There Are A Lot Of People Trading Options?

Did You Know You Can Actually Buy and Sell Your Options to Other People?

Did You Know You Can Dramatically Increase Your Return on Investment by Trading Options?

Did You Know that You NEVER Want to "Make As Much Money As Possible" on a Deal?

Best of All: Did You Know You Can Combine Option Instruments to Reduce Risk and Make Money in Every Market Trend-All at the Same Time?

Step 4

More Time Travel

What Is An Option Worth?

Strike Three

Choosing Stocks

Reading the Tea Leaves (1)

Reading the Tea Leaves (2) - Stock Trends

Getting the Final Pieces in Place

Fun, Fun, Fun!

Understanding Two Basic Option Trades.

Insuring Your Investment

Shorty Heaven - Selling Your Way to Profits

Step 6

Trading in Surround Sound: The Fundamental Spread Trade

The Two Basic Ways to Make Money in Spread Trading

Understanding Bullish Spread Trades.

The Bull Call

The Bull Put

Bull vs. Bull

Understanding Bearish Spread Trades.

The Bear Call

The Bear Put

Bear vs. Bear

Getting Started.

Lifting the Fog

The Launch!

Appendix: Answers to End of Chapter Reviews

Index

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