目录
CHAPTER 1 Trade and Risk Management 1
Introduction 1
The Philosophy of Risk 2
Truth about Reward 5
Risk Management 7
Risk 7
Reward 10
Breakeven Points 11
Trade Management 12
Trading Theme 12
The Theme of Your Portfolio 15
Diversification and Flexibility 16
Trading as a Business 16
Start-Up Phase 17
Growth Phase 20
Mature Phase 20
Just Business, Nothing Personal 21
SCORE—The Formula for Trading Success 22
Select the Investment 22
Choose the Best Strategy 24
Open the Trade with a Plan 24
Remember Your Plan and Stick to It 26
Exit Your Trade 27
CHAPTER 2 Tools of the Trader 29
Introduction 29
Option Value 30
Option Pricing 31
Stock Price 32
Strike Price 32
Time to Expiration 32
Volatility 32
Dividends 33
Interest Rates 33
Time Value Premium 33
Time Decay 33
Early Assignment 36
Implied Volatility 38
Synthetic Positions 41
Synthetic Stock 42
Synthetic Call 44
Synthetic Put 46
Basic Strategies 47
Long Call 47
Short Call 48
Long Put 48
Short Put 50
Basic Spreads and Combinations 50
Bull Call Spread 51
Bull Put Spread 51
Bear Put Spread 52
Bear Call Spread 53
Long Straddle 54
Long Strangle 54
Short Straddle 56
Short Strangle 57
Advanced Spreads 58
Call Ratio Spread 58
Put Ratio Spread 59
Call Ratio Backspread 60
Put Ratio Backspread 61
Long Butterflies 62
Short Butterflies 63
CHAPTER 3 Long Stock 65
Introduction 65
Protective Put 66
Stock Moves Higher 69
Stock Moves Lower 71
Bear Put Spread 74
Rolling from a Protective Put into a Bear Put Spread 76
Rolling from a Bear Put Spread into a Protective Put 78
Call Replacement 80
Stock Moves Higher 81
Stock Moves Lower 82
Call Replacement versus Protective Put 83
Sell Covered Calls 83
Stock Moves Higher 85
Strike Selection 87
In the Money Calls 88
Time to Expiration 91
Scaling-Out Strategy 92
Collars 94
Opening Position—Regular Collar 94
Stock Moves Higher—Profit Collar 97
Ratio Write 100
Opening Position 101
Stock Moves Higher—Regular Ratio Write 103
Stock Moves Higher—Variable Strike Ratio Write 110
Stock Moves Lower—Ratio Write/Variable Strike Ratio Write 114
Short Straddle/Short Strangle 117
Opening Position—Short Straddle 117
Opening Position—Short Strangle 121
Stock Moves Higher—Short Straddle 123
Stock Moves Higher—Short Strangle 129
Stock Moves Lower—Short Straddle/Stock Repair 133
Stock Moves Lower—Short Strangle 137
Call Ratio Spread 140
Opening Position 143
Stock Moves Higher 147
Stock Moves Lower—Stock Repair Strategy 152
Call Calendar Spread 155
Opening Position 156
Stock Moves Higher 158
CHAPTER 4 Short Stock 163
Introduction 163
Protective Call—Insurance 165
Opening Position—Protective Call 165
Opening Position—Protective Call Spread 170
Short Stock Protective Call Long Put 172
Stock Moves Lower—Protective Call 174
Stock Moves Lower—Protective Call Spread 177
Rolling between Protective Calls and Protective Call Spreads 181
Stock Moves Higher 183
Put Replacement 185
Stock Moves Lower 186
Stock Moves Higher 188
Put Replacement versus Protective Call 189
Covered Puts 190
Stock Moves Lower 191
Short Collars 196
Opening Position—Regular Collar 197
Stock Moves Lower—Profit Collar 199
Put Ratio Write 201
Opening Position 202
Stock Moves Lower—Regular Ratio Write 205
Stock Moves Lower—Variable Strike Ratio Write 210
Put Ratio Spread 212
Opening Position 212
Stock Moves Lower 215
Stock Moves Higher—Short Repair Strategy 218
CHAPTER 5 Calls and Puts 221
Introduction 221
Long Call 222
Protective Put—Stock Moves Higher 222
Protective Put—Stock Moves Lower 224
Call Replacement 226
Rolling into a Bull Call Spread—Stock Moves Higher 229
Rolling into a Bull Call Spread—Stock Moves Lower/Call
Repair Strategy 231
Rolling into a Bear Call Spread 232
Short Stock 235
Rolling into a Synthetic Straddle 236
Rolling into a Calendar Spread 237
Rolling into a Ratio Spread 240
Stock Moves Lower—Call Repair Strategy 244
Short Call 248
Long Put 249
Protective Call 250
Put Replacement Therapy 253
Rolling into a Bear Put Spread 255
Rolling into a Bull Put Spread 259
Long Stock/Synthetic Straddle 260
Put Calendar Spread 265
Put Ratio Spread 267
Short Put 273
CHAPTER 6 Spreads 277
Introduction 277
Bull Call Spreads/Bear Put Spreads 277
Protective Puts/Protective Calls 278
Convert to Ratio Spreads 283
Convert to Butterflies 297
Bear Call Spreads/Bull Put Spreads 300
Calendar Spreads 301
Call Calendar Spread 301
Put Calendar Spread 305
CHAPTER 7 Combinations 311
Introduction 311
Long Straddle 311
Straps/Strips 312
Modified Straps/Strips 315
Calendar Straddle 318
Rolling a Long Straddle into an Iron Butterfly 320
Diagonal Iron Butterfly 321
Partial Iron Butterfly 322
Long Call/Long Put Adjustments 323
Long Strangle 323
Diagonal Iron Butterfly 324
Calendar Strangle 325
Long Call/Long Put Adjustments 326
Short Straddle/Short Strangle 326
Short Straddle 327
Short Strangle 329
Index 331
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