x
Breaking News
0

Book Review: Understanding Options, 2nd Edition

By Brenda JubinMarket OverviewMar 12, 2014 05:49AM ET
www.investing.com/analysis/book-review:-understanding-options,-2nd-edition-205709
Book Review: Understanding Options, 2nd Edition
By Brenda Jubin   |  Mar 12, 2014 05:49AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Michael Sincere, a full-time writer with several investing and trading books to his credit, has updated and expanded Understanding Options, originally published in 2006 (McGraw-Hill). Its intended audience is the novice, although for this second edition he went beyond the basics, including a section on intermediate and advanced strategies and an interview with Sheldon Natenberg.

Sincere works hard to make options accessible and “entertaining.” In introducing the concept of an option he gives not only the standard example of an option on a house but adds the case of buying options on snow shovels. (Admittedly, as I'm writing the draft of this review I can’t consider anything having to do with snow shovels even remotely entertaining, but some day it will warm up, my endlessly long, steep driveway that I spent two days hand shoveling and that is now a treacherous sheet of ice will clear, and the oil truck will be able to come down since I suspect I’m currently heating the house on fumes. [Update for those who feared that some poor soul would find me frozen solid with a book clutched in my hands: Success!])

Sincere starts with five chapters on selling covered calls and continues with six chapters on buying calls and four on buying puts. He clearly explains issues that tend to trip up beginning option traders, such as exercise and assignment.

The intermediate and advanced section of the book is rather sketchy. In about eighty pages he describes credit and debit spreads, buying straddles and strangles, selling cash-secured and naked puts, delta and the other Greeks, advanced strategies (iron condors, calendars, and butterflies), and trading options with ETFs, indexes, weeklys, and mini-options.

The merit of Sincere’s book is that it provides a clear introduction to the mechanics of opening and managing straightforward options positions. This is information that every option trader should understand thoroughly. Understanding Options should not be the last book that he reads, but it’s a good first one.

Book Review: Understanding Options, 2nd Edition
 
Book Review: Understanding Options, 2nd Edition

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

 
Are you sure you want to delete this chart?
 
Write your thoughts here
 
Replace the attached chart with a new chart ?
Post
Post also to:
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
 
Replace the attached chart with a new chart ?
Post 1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email