Options As A Strategic Investment.epub
Garcia Miller
Hi, I'm thinking to buy the "Options as a strategic investment", 5th edition book as I have heard good things about it. Now I see it was published in 2012, lots of things could have changed since. Is it still relevant in today's market?
The new edition is revised to represent the latest trading vehicles and applications, including coverage of long-term equity anticipation securities LEAPs, preferred equity redemption cumulative stocks PERCs, neutral trading, futures options, warrants, and standard portfolio analysis of risk SPAN. The idea, of course, is to maximize earnings and reduce riskno matter how the market is performing. Strategy techniques and examples show how to do it.
The new edition is revised to represent the latest trading vehicles and applications, including coverage of long-term equity anticipation securities (LEAPs), preferred equity redemption cumulative stocks (PERCs), neutral trading, futures options, warrants, and standard portfolio analysis of risk (SPAN). The idea, of course, is to maximize earnings and reduce risk--no matter how the market is performing. Strategy techniques and examples show how to do it. Annotation c. Book News, Inc., Portland, OR (booknews.com)
Credit spreads involve the simultaneous purchase and sale of options contracts of the same class (puts or calls) on the same underlying security. In the case of a vertical credit put spread, the expiration month is the same, but the strike price will be different.
In the case of this credit spread, your maximum loss cannot exceed $3,500. This maximum loss is the difference between the strike prices on the two options, minus the amount you were credited when the position was established.
However, because you brought in $1,500 when the spread was established, your net gain is the entire $1,500. This maximum profit of $1,500 will occur at all prices above $70.As you can see from these scenarios, using credit put spreads works to your advantage when you expect the price of XYZ to rise, which will result in a narrowing of the spread price or, ideally, both options expiring worthless.
If you had sold the May 75 calls uncovered, you would have initially brought in $2,000 rather than $1,500. However, the trade-off for reduced $500 profit potential is the ability to limit risk significantly. If you had simply sold the May 75 calls uncovered, your loss potential would have been virtually unlimited if XYZ were to rise substantially. In the case of this credit spread, your maximum loss cannot exceed $3,500. This maximum loss is the difference between the strike prices on the two options, minus the amount you were credited when the position was established.
As you can see from these scenarios, using credit call spreads works to your advantage when you expect the price of XYZ to fall, which would result in a narrowing of the spread price or, ideally, both options expiring worthless.
Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Please read the options disclosure document titled Characteristics and Risks of Standardized Options before considering any option transaction.
Spread and uncovered options strategies involve potential for unlimited risk, and must be done in margin accounts. Margin trading increases your level of market risk. For more information please refer to your account agreement and the Margin Risk Disclosure Statement.
Options can be a useful tool, especially in volatile markets, allowing for greater leverage and the ability to hedge your positions and potentially generate additional income. And when you add educational resources and support from options trading specialists, innovative platforms, and straightforward pricing with no hidden fees, you'll find we offer everything traders need to trade options.
With features like Options Statistics, Options Probabilities, and the Analyze Tab, our #1 rated trading platform thinkorswim desktop1 and the thinkorswim mobile app can help position you for options trading success. We put the tools you need to make more informed options trading decisions, quickly and efficiently, all in one place.
Options involve risks and are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Options trading privileges subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Options before trading options.
Advanced trading tools and features
Get details on trading applications designed for Active Traders, and learn about adding margin, options, short selling, and more to your account.
$0.00 commission applies to online U.S. equity trades, exchange-traded funds (ETFs), and options (+ $0.65 per contract fee) in a Fidelity retail account only for Fidelity Brokerage Services LLC retail clients. Sell orders are subject to an activity assessment fee (historically from $0.01 to $0.03 per $1,000 of principal). There is an Options Regulatory Fee that applies to both option buy and sell transactions. The fee is subject to change. Other exclusions and conditions may apply. See Fidelity.com/commissions for details. Employee equity compensation transactions and accounts managed by advisors or intermediaries through Fidelity Institutional are subject to different commission schedules.
Options trading entails significant risk and is not appropriate for all investors. Certain complex options strategies carry additional risk. Before trading options, please read Characteristics and Risks of Standardized Options. Supporting documentation for any claims, if applicable, will be furnished upon request.
Very little has been published on optimization of pharmaceutical portfolios. Moreover, most of published literature is coming from the commercial side, where probability of technical success (PoS) is treated as fixed, and not as a consequence of development strategy or design. In this book there is a strong focus on impact of study design on PoS and ultimately on the value of portfolio. Design options that are discussed in different chapters are dose-selection strategies, adaptive design and enrichment. Some development strategies that are discussed are indication sequencing, optimal number of programs and optimal decision criteria.
Zoran Antonijevic is a Senior Director at Cytel Consulting with responsibility for strategic advice at trial, program, or portfolio level. His research areas include: adaptive design, pharmaceutical portfolio optimization, and decision-making within clinical drug development process. Zoran has 20 years of experience in drug development. His prior experience includes positions at Harvard School of Public Health, GlaxoSmithKline, and Quintiles Innovation where his primary responsibility was to develop designs and approaches that maximize probability of success for programs and/or maximize product's value. He also has extensive experience with performing due-diligence, and as a member of product portfolio executive teams. Externally, Zoran is the chair of DIA Adaptive Design Scientific Working Group.
Traditional buy-and-hold investing has been seriously challenged in the wake of the recent financial crisis. With economic and market uncertainty at a very high level, options are still the most effective tool available for managing volatility and downside risk, yet they remain widely underutilized by individuals and investment managers. InOptions for Volatile Markets, Richard Lehman and Lawrence McMillan provide you with specific strategies to lower portfolio volatility, bulletproof your portfolio against any catastrophe, and tailor your investments to the precise level of risk you are comfortable with.
While the core strategy of this new edition remains covered call writing, the authors expand into more comprehensive option strategies that offer deeper downside protection or even allow investors to capitalize on market or individual stock volatility. In addition, they discuss new offerings like weekly expirations and options on ETFs. For investors who are looking to capitalize on global investment opportunities but are fearful of lurking "black swans", this book shows how ETFs and options can be utilized to construct portfolios that are continuously protected against unforeseen calamities.
Understanding options is now more important than ever, and withOptions for Volatile Markets as your guide, you'll quickly learn how to use them to protect your portfolio as well as improve its overall performance.
RICHARD LEHMAN is the founder of RHL Capital, a registered investment advisor, and a part-time instructor of behavioral finance and options at UC Berkeley Extension. He is also the author ofFar From Random, and publishes an investment newsletter called the Channelist. Lehman's financial career spans more than thirty years in product management, marketing, sales, and investment management beginning with an eleven-year stint on Wall Street with E.F. Hutton& Co., Thomson McKinnon Inc., and the New York Stock Exchange.LAWRENCE G. MCMILLAN is the founder and President of McMillan Analysis Corporation. He authors theDaily Volume Alerts, a unique daily service that selects short-term stock trades by looking for unusual increases in equity option volume. McMillan manages option-oriented accounts for individual investors and also publishes the Option Strategist, a derivative products newsletter covering equity, index, and futures options. McMillan's web site, www.optionstrategist.com, twice received a "Best of the Web" award fromForbes magazine. He is the coauthor, with Richard Lehman, of the first edition of this book and the author ofMcMillan on Options (Wiley) andOptions as a Strategic Investment. Inhalt Preface xi
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