This Second Edition of Trading
Option Greeks
This book addresses the complex price behavior of options by discussing
option greeks from both a theoretical and a practical standpoint. There is
some tactical discussion throughout, although the objective of this book is
to provide education to the reader. This book is meant to be less a how-to
manual than a how-come tutorial.
This informative guide will give the retail trader a look inside the mind of
a professional trader. It will help the professional trader better understand
the essential concepts of his craft. Even the novice trader will be able to
apply these concepts to basic options strategies. Comprehensive knowledge
of the greeks can help traders to avoid common pitfalls and increase profit
potential.
Much of this book is broken down into a discussion of individual
strategies. Although the nuances of each specific strategy are not relevant,
presenting the material this way allows for a discussion of very specific
situations in which greeks come into play. Many of the concepts discussed
in a section on one option strategy can be applied to other option strategies.
As in the first edition of Trading Option Greeks , Chapter 1 discusses
basic option concepts and definitions. It was written to be a review of the
basics for the intermediate to advanced trader. For newcomers, it’s essential
to understand these concepts before moving forward.
A detailed explanation of option greeks begins in Chapter 2. Be sure to
leave a bookmark in this chapter, as you will flip to it several times while
reading the rest of the book and while studying the market thereafter.
Chapter 3 introduces volatility. The same bookmark advice can be applied
here, as well. Chapters 4 and 5 explore the minds of option traders. What
are the risks they look out for? What are the opportunities they seek? These
chapters also discuss direction-neutral and direction-indifferent trading. The
remaining chapters take the reader from concept to application, discussing