The Option Trader's Guide to Probability, Volatility, and Timing

Options are a very attractive investment, primarily because of the degree of leverage and enhanced profit potential associated with them. But they can also be very dangerous if you don t know how to handle elements such as implied volatility, time decay, and out of the money versus in the money options. In The Option Trader s Guide to Probability, Volatility, and Timing, expert Jay Kaeppel explains these issues and provides you with a working knowledge of various option strategies that are appropriate for any given situation. Whether you re a new trader or "returnee" to the options market, this book will teach you how to successfully trade options. Kaeppel sets the stage by covering basics such as option definitions and option pricing. He then quickly moves to the heart and soul of this unique investment vehicle by analyzing both the risk and profit potential of various trading strategies. Kaeppel further sets his approach apart by providing his unique perspective on risk curves a revolutionary new trading tool to maximize the tradeoff between reward and risk on each and every trade. This comprehensive guide explains the different strategies available as well as when to use each of them. Strategies include guidelines for determining when to buy undervalued options and when to sell overvalued ones. You ll also learn how to accurately assess volatility and profit from disparities in implied volatilities of different options. To help you safeguard your money, you ll discover valuable strategies that will teach you when to take a profit and when to cut your losses. Options are different in many ways from other forms of investment. To profit from them, you must have a firm understanding of what they are, how they work, and how they must be traded. The Option Trader s Guide to Probability, Volatility, and Timing addresses these topics, and many more, to give you a well rounded overview of this investment vehicle. Filled with practical advice from an expert in the field and real world strategies that have stood the test of the options market, this book is an invaluable resource for anyone looking to trade options intelligently and confidently. If you re serious about trading options, read The Option Trader s Guide to Probability, Volatility, and Timing and learn how to achieve consistent profits in one of the most lucrative markets in the world.