It is time for another book club recommendation. This time I am going to recommend a book that might be useful for anyone that was interested and intrigued by the structure of my Tesla Short Trade using put option contracts. They were relatively new to me and I spent a long time researching and speaking to a friend who is an institutional options trader before entering the trade.
This months book recommendation is The Options Playbook by Brian Overby.
The Options Playbook was created to demystify option trading and teach investors different option plays for all market conditions. No confusing jargon. No unnecessary mumbo-jumbo. Just clear, easy-to-understand explanations of more than 40 of the most popular option strategies broken down into a play-by-play format.
I liked this book because it puts in the groundwork by explaining about what stock/FX options are, how they work. It then goes on to explain how different options trades can work depending on what type of investor/trader you are and what you are trying to achieve. For more advanced traders, there is an expanded section on implied volatility explains how this handy variable can be used to find the potential range of the stock over the options life. A detailed section on pricing variables helps you understand how an option’s price is affected by changes in market conditions.
This book is a great place to start looking in to the different ways you can use options contracts to structure trades differently to simply shorting the underlying stock or derivative. There are a number of benefits to using options contracts when trading and some of these are explained within this book.
Both paperback and e-book copies can be purchased via the links below.
Paperback Edition – https://amzn.to/3bUmVHB
Kindle Edition – https://amzn.to/32hsDQy