THE OPTION TRADER'S GUIDE TO PROBABILITY, VOLATILITY, AND TIMING

A comprehensive guide that lets you play the options game with confidence
Due to the uncontrollable elements associated with options, many traders find themselves without practical strategies for specific situations. The Option Trader's Guide to Probability, Volatility, and Timing offers traders a variety of strategies to trade options intelligently and confidently in any given situation. With detail and objectivity, this book sets forth risk assessment guidelines, explains risk curve analysis, discusses exit methods, and uncovers some of the biggest mistakes options traders make. The Option Trader's Guide provides readers with strategies for trading options as well as expert advice on when to implement those strategies.

JAY KAEPPEL is Director of Research at Essex Trading Company, Ltd., a leading developer of trading software for options and futures traders. He is also an active CTA (commodity trading advisor). With over twenty years' experience, Jay's expertise as a system developer has been noted by Technical Analysis of Stock & Commodities magazine and Formula Research, a renowned trading system advisory newsletter. His articles and interviews have appeared in leading industry publications, and his previous books include The Four Biggest Mistakes in Options Trading and The Four Biggest Mistakes in Futures Trading.

Introduction.

The Basics of Options.

Reasons to Trade Options.

Option Pricing.

Time Decay.

Volatility.

Probability.

Market Timing.

Trading Realities.

Important Concepts to Remember.

Overview of Trading Strategy Guides.

Buy a Naked Option.

Buy a Backspread.

Buy a Calendar Spread.

Buy a Straddle.

Sell a Vertical Spread.

Sell a Naked Put.

Write a Covered Call.

Enter a Butterfly Spread.

Placing Trades.

Epilogue: Some Random Thoughts for Option Traders.

Appendix A: PROVEST Option Trading Method Criteria.

Appendix B: Option Exchanges, Option Brokers, Option Symbols, and Option Volume.

Index.