Trading Options in Turbulent Markets: Master Uncertainty through Active Volatility Management - Hardcover
Synopsis
A thoughtful presentation of options trading and pricing which discusses the impact of volatility in the process
Trading Options in Turbulent Markets reveals how volatility in options trading relates to today's stormy marketplace and shows you how to manage risk and take advantage of market volatility when investing in derivatives. In this book, options expert Larry Shover skillfully addresses how to use historical volatility to predict future volatility for a security, or the implied volatility, and offers suggestions for dealing with that odd feature of options trading known as skew.
Trading Options in Turbulent Markets also looks at specific options trading strategies that help you offset risk and reach for profit. These include the covered call, the naked and the married puts, collars, straddles, vertical spreads, calendar spreads, butterflies, condors, and more.
- Contains proven tools for evaluating options trading decisions, including the greeks: delta, vega, theta, and gamma
- Outlines effective strategies for trading options contracts in uncertain times
- Offers insights on the risk/reward situations all traders in this field face
Filled with in-depth insights and practical advice, this important resource explores how to turn turbulent markets into profitable opportunities, and discusses why options are the best tool to use in such a difficult endeavor.
From the Author: Six Things You Need to Know About Option Volatility
1. Option volatility is the direct result of an inefficient marketplace. It’s the collective product of people's fear, irrationality, and outlook on the market.
2. Option volatility is persistent in nature. Periods of low or high volatility tend to remain for far-reaching and extended amounts of time.
3. A sudden change in option volatility can quickly alter your emotions. It can trigger fright and dull the brains ability to make wise decisions.
4. Baseball has a saying, “The ball will always find you.” Option trading has a similar saying, “Option volatility will eventually find you.” Volatility will inevitably strike you when you are least prepared.
5. Option volatility is a great unknown. No matter what is said, modeled, or written about it, volatility simply cannot be forecasted.
6. Option volatility amounts to risk – and that risk is derived from the notion of randomness that surrounds us.
"synopsis" may belong to another edition of this title.
About the Authors
Larry Shover has been an options trader for more than 25 years and taught classes on options for more than 20 years for the Chicago Mercantile Exchange (CME) and proprietary trading firms. He has served as director of education, senior vice president of trading, and director of global trader development at several commodities and options firms. Shover is a member of the CME and the Chicago Board Options Exchange (CBOE) and holds several Financial Industry Regulatory Authority (FINRA) licenses.
Larry Shover has been a firm and proprietary options trader for more than twenty-five years and has had the opportunity to give speeches and teach courses at a variety of exchanges including the Chicago Mercantile Exchange (CME) for more than twenty years. A large part of his career has been dedicated to developing his own proprietary trading firm, and he has also served as director of education, senior vice president of trading, and director of global trader development at several commodities and options firms. Shover is a member of the CME and the Chicago Board Options Exchange (CBOE) and holds several Financial Industry Regulatory Authority (FINRA) licenses.
LARRY SHOVER has been a firm and proprietary options trader for more than twenty-five years and has had the opportunity to give speeches and teach courses at a variety of exchanges including the Chicago Mercantile Exchange (CME) for more than twenty years. A large part of his career has been dedicated to developing his own proprietary trading firm, and he has also served as director of education, senior vice president of trading, and director of global trader development at several commodities and options firms. Shover is a member of the CME and the Chicago Board Options Exchange (CBOE) and holds several Financial Industry Regulatory Authority (FINRA) licenses.
From the Back Cover
Praise for Trading Options inTurbulent Markets
"Of the five basic variables that drive option pricing models, the volatility assumption is far and away the most impactful. Mr. Shover's definitive work, exploring all aspects of the world of volatility, truly is a gift to the investing public."
William Floersch, President and CEO, Fortis Clearing Americas, LLC
"There are a myriad of 'Options 101' books for the beginning options investor and painfully lengthy and dry graduate-level books on advanced strategies. Larry has found the sweet spot in between, offering a great book on intermediate option strategies. I can heartily endorse Trading Options in Turbulent Markets as THE book for investors seeking to enhance their knowledge of derivative trading and createa low-risk, high-return investment game plan."
Jon "Doctor J" Najarian, cofounder, tradeMONSTER.com
"Mr. Shover has managed to marry a thoughtful presentation of volatility as it relates to options pricing and options trading, with a narrative that goes beyond the purely theoretical and focuses on the practical implications of this 'measure of instability' (first line of Chapter 2) for those who use options. In light of the tumultuous events that have churned the global financial markets, a read on the practical implications of volatility seems prudent for all who choose to employ options."
Pat Arbor, Chairman Emeritus, CBOT, and current Director ofFirst Chicago Bank and Trust
"Shover's book offers valuable insights from his real-life experience in trading volatile markets."
Jim Bittman, Senior Instructor, The Options Institute at CBOE, and author of Trading Options as a Professional
"Larry Shover was a successful options trader in his years at CRT and a valuablemember of our team. His book is both accessible and informative, and its pages are filled with insights gained from many years of experience. Larry writes with passion and acumen, making this a book that will do more than just sit on your shelf."
Joseph Ritchie, founder, Chicago Research and Trading Group (CRT); founder and Chairman, Fox River Financial Resources, Inc.; andCEO, Rwanda Development Board
From the Inside Flap
Trading Options in Turbulent Markets reveals how volatility in options trading relates to today's stormy marketplace and shows you how to manage risk and take advantage of market volatility when investing in derivatives. Options expert Larry Shover skillfully addresses how to use historical volatility to predict future volatility for a security, or the implied volatility, and offers suggestions for dealing with that odd feature of options trading known as skew in which the options market has, in recent decades, essentially developed its own consciousness and can respond to market conditions that defy all logic. Skew is uncertainty squared, and here, Shover describes how to work with or around it.
Larry Shover also includes proven tools for evaluating options trading decisions: the Greeks delta, vega, theta, and gamma. He then defines thevalues carefully and describes how each relates to volatility. In addition, he provides effective strategies for trading options contracts in uncertain times,addresses the decision-making process in broad terms, and discusses how to become a steel-nerved trader. Along the way, this book answers such complexissues as: How does a trader know when to tolerate risk? How does a successful trader think, or respond to adversity? How does a trader lose well?
Trading Options in Turbulent Markets also looks at specific options trading strategies that help you offset risk and reach for profit. These include the covered call, the naked and married puts, collars, straddles, vertical spreads, calendar spreads, butterflies, condors, and more.
Filled with in-depth insights and practical advice, this important resource explores how to turn turbulent markets into profitable opportunities, and reveals why options are the best tool to use in such a difficult endeavor.
"About this title" may belong to another edition of this title.
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