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“The author has written a truly complete reference book on options trading, from basics to strategies to taxes and theory. Newcomers to options can quickly find a clear explanation of terms or strategies they aren’t familiar with, and experienced traders can expand their understanding of how complex strategies are created.”
--Jim Bittman, author, Trade Options Like a Professional
“For a new perspective about options, I recommend Michael Thomsett’s comprehensive The Options Trading Body of Knowledge. Traders at all levels will enjoy his easy-to-read style as he explains options from A to Z. The options industry has needed a reference like this for a long time.”
--Marty Kearney, Senior Staff Instructor, The Options Institute
The Comprehensive, Up-to-Date Reference for Every Options Trader
Options offer investors multiple opportunities to enhance their profits. However, options trading is complex, and the sheer scope of available strategies can overwhelm traders. Today, options can support a wide range of strategies, from high risk to conservative. Moreover, options are available not only for stock equities but also for futures, indices, and mutual funds. To trade successfully, traders need an authoritative, up-to-date guide to all the strategies available to them. Now, renowned options expert and best-selling author Michael C. Thomsett has created the definitive reference for options traders at all levels of experience.
Thomsett systematically illuminates each key technique and strategy: how trades are structured, how to assess risk, and when each strategy is most applicable. For most strategies, Thomsett presents detailed tables and illustrations identifying profit zones, loss zones, and breakeven points.
This book thoroughly explains how option premium develops based on various elements of value, walks through the calculation of returns on options trading, discusses how federal taxation works in the options market, shows how stocks are picked for options trading, and provides a complete glossary and additional resources for traders.
Chapter 1: Market Overview 5
Chapter 2: Market Risks 19
Chapter 3: Elements of Value 35
Chapter 4: Return Calculations 49
Chapter 5: Options and Stock Selection 63
Chapter 6: Option Taxation 73
Chapter 7: Option Strategies A-C 81
Chapter 8: Option Strategies D-P 107
Chapter 9: Option Strategies R-Z 139
Chapter 10: Online Resources 191
Chapter 11: Option Print Resources 195
Chapter 12: Option Glossary 199
Appendix: Options Listings 273