The options edge + free trial : an intuitive approach to generating consistent profits for the novice to the experienced practitioner
Michael C. Khouw, Mark W. Guthner, CFA.
Intro -- Series Page -- Title Page -- Copyright -- Table of Contents -- Dedication -- Introduction -- Additional Resources -- Chapter 1: What Is an Option, and How Do Options Work? -- How Options Are Created, Extinguished, and Settled -- Exercising an Option -- Assignment -- Deliverables -- Behavior of Option Prices -- Option Premium -- Moneyness -- The Relationship between Puts, Calls, and the Underlying Asset -- Leverage and Risk -- Chapter 2: Valuing Options with the Black-Scholes-Merton Option-Pricing Model -- Assumptions of the Black-Scholes-Merton Option Pricing Model -- The Black-Scholes-Merton Option-Pricing Model -- Intuition behind the Option-Pricing Model -- Understanding the Drivers of Option Prices -- Putting It All Together: The Total Differential and Return Attribution -- Notes -- Chapter 3: Trading Volatility -- Realized Volatility -- Implied Volatility -- Skew and the Volatility Smile -- Term Structure of Volatility -- Volatility Surface -- The Relationship between Realized Volatility and Implied Volatility -- How to Trade Volatility -- Gamma Scalping -- Straddles -- Strangles -- Calendar Spreads -- Chapter 4: Are Options Fairly Priced? -- Modern Portfolio Theory (MPT) -- Capital Asset Pricing Model (CAPM) -- Evaluating Historical Returns on Put Options -- Evaluating Historical Returns on Call Options -- Conclusions about Option Returns -- Why Do Options Behave as If They Are Overpriced? -- Notes -- Chapter 5: Fundamental Option Strategies -- Single-Leg Puts and Calls -- Vertical Spreads -- Ratio Spreads -- Risk Reversals -- Call Spread Risk Reversals -- Income-Generating Strategies -- Chapter 6: Portfolio Hedging Producing Enhanced Returns -- Anticipatory Hedging -- Permanent Hedging -- Optimal Hedging Strategies -- Hedging High-Yield Debt with Equity -- Building a Proper Hedge -- Diagonal Put Spreads.