Options Math for Traders, + Website: How To Pick the Best Option Strategies for Your Market Outlook

by Scott Nations

A practical guide to the math behind options and how that knowledge can improve your trading performance No book on options can guarantee success, but if a trader understands and utilizes option math effectively, good things are going to happen. The idea behind Options Math for Traders + Website is to help retail option traders understand some of the basic tenants and enduring relationships of options, and option math, that professional and institutional traders rely on every day. This book skillfully highlights those strategies that are inherently superior from an option math point of view and explains what drives that superiority while also examining why some strategies are inherently inferior. The material is explained without complex equations or technical jargon. The goal is to give you a solid conceptual foundation of options behavior so you can make more informed decisions when choosing an option strategy for your market outlook. Topics covered include the volatility premium, because over time, options will cost more than they are ultimately worth; skew, wherein far out of the money put options may seem cheap from an absolute term, but are very expensive in relative terms; and the acceleration in option price erosion. The book also has a companion Website, which includes links to those sites that can scan for the best strategies discussed in the book. Most independent traders have an imperfect understanding of the math behind options pricing. With Options Math for Traders + Website as your guide, you'll gain valuable lessons in this area and discover how this information can improve your trading performance.

272 pages, Hardcover

First published October 1, 2012

Reviews

[Cario Lam · Rating 4 out of 5]

Don’t let the title of the book discourage you from picking it up and reading it. The author is not a rocket scientist and the material is anything but mathematically rigorous. Instead he goes into detail of what drives options prices and lays out the scenarios for follow up actions after the trade is placed and he does this in great detail.