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An Empirical Investigation of Market Efficiency in Option Spread Pricing

An Empirical Investigation of Market Efficiency in Option Spread Pricing PDF Author: William W. Welch
Publisher:
ISBN:
Category : Hedging (Finance)
Languages : en
Pages : 40

Book Description


An Empirical Investigation of Market Efficiency in Option Spread Pricing

An Empirical Investigation of Market Efficiency in Option Spread Pricing PDF Author: William W. Welch
Publisher:
ISBN:
Category : Hedging (Finance)
Languages : en
Pages : 40

Book Description


Market Efficiency

Market Efficiency PDF Author: Ladd Michael Kochman
Publisher:
ISBN:
Category : Efficient market theory
Languages : en
Pages : 134

Book Description


Option Spreading and Market Efficiency

Option Spreading and Market Efficiency PDF Author: George M. Frankfurter
Publisher:
ISBN:
Category : Options (Finance)
Languages : en
Pages : 26

Book Description


Option Spread Trading

Option Spread Trading PDF Author: Russell Rhoads
Publisher: John Wiley & Sons
ISBN: 0470618981
Category : Business & Economics
Languages : en
Pages : 294

Book Description
A practical guide to unlocking the power of option spreads When dealing with option spreads your looking to purchase one option in conjunction with the sale of another option. If managed properly, these spreads can provide experienced investors with the potential for large returns without undertaking a great deal of risk. Option Spread Trading provides a comprehensive, yet easy-to-understand explanation of option spreads, and shows you how to select the best spread strategy for any given market outlook. Along the way, author Russell Rhoads discusses spread strategies that can be used to profit from a strong up or down directional move in a stock, a stagnant market, or a highly volatile market. He also details how you can harness the leverage of options to create a low-risk position that provides the potential for a big profit. All manner of spreads are covered, from calendar and horizontal spreads to vertical and diagonal spreads Highlights how you can monitor and adjust an existing spread position and provides tips on how to exit a spread trade Includes exercises and examples to test and reinforce your knowledge of the concepts presented Option spread trading has become increasingly popular with active traders and investors. Gain a better understanding of this powerful approach with Option Spread Trading as your guide.

Mastering Option Credit Spread Trading

Mastering Option Credit Spread Trading PDF Author: Timmy Korando
Publisher:
ISBN:
Category :
Languages : en
Pages : 118

Book Description
Option credit spread strategy is one of the best ways to take advantage of the stock market's complex behavior. In this Credit Spread Options Book, you will discover: - The 8 criteria we use to select the best stocks to write credit spreads - The vital difference between naked and uncovered calls - 10 examples of stock you should never use to trade credit spreads. Amateurs do this all the time and you can lose as much as $31,000 on a single trade. Learn why these stocks are so dangerous and what to do instead - How to automatically set up take profit levels so you only have to spend a couple of minutes each month managing your trades - Options Greeks explained in 10 minutes - Exactly what level the VIX should be at before you sell a spread. A backtest implementing this one tweak made the strategy 50% more profitable over 10 years worth of trades - A simple strategy for selecting the right strike price for your options - The only 3 technical indicators you need to know for credit spreads. Ignore everything else, you only need these 3 beginner-friendly metrics to get started - No strategy is risk-free, but on page 101 we show you how to set up your trades to avoid any big losses - How to find the best credit spreads stocks for free. Stock scanning services will charge you $300 a year for this information, but our approach costs nothing and lists the exact same companies So, you would finally realize that options analysis and trading is not rocket science but rather an efficient way to successfully trade the dynamic stock market.

Trading Volatility Spreads

Trading Volatility Spreads PDF Author: Peter F. Pope
Publisher:
ISBN:
Category :
Languages : en
Pages : 33

Book Description
If returns on two assets share common volatility components, the prices of options on the assets should be interdependent and the implied volatility spread should mean revert. We, first demonstrate, using the canonical correlation method, that there is a common component among the volatilities of the returns on Samp;P 100 and Samp;P 500 indexes. We then exploit this commonality by trading on the volatility spread between tick-by-tick OEX and SPX call options listed on the CBOE. Our vega-delta-neutral strategies generated significant profits, even after transaction costs are taken into account. The results suggest that the two options markets are not jointly efficient.

Vertical Option Spreads

Vertical Option Spreads PDF Author: Charles Conrick, IV
Publisher: John Wiley & Sons
ISBN: 1118746937
Category : Business & Economics
Languages : en
Pages : 259

Book Description
Make trades on vertical options spreads with the precision of a laser beam Vertical Options Spreads is a combination of a bona-fide academic research-based study and a complete method to trade credit and debit spreads, along with other complex option combination trades such as iron condors and butterflies. Here, the author has accumulated five years of daily data on the ETF, SPY and provided historical evidence of actual win rates at specific multiples of entry points, both in time and price level. For example, traders will be able to use the weekly options, pick a level of risk and return desired, learn how to place the trade, and then discover the actual percent return that the trade would have yielded. This must-have resource includes the basics of option trading and contains references to many excellent works by other authors that explore more about the intricacies of option mechanics and trading. It is far more than an analysis of one specific asset, SPY, featuring a study of probability theory and how it has applied to trading over the past five years, including the highly volatile 2007 to 2009 time frame and the more "normal" 2010 to 2012 time period. The book offer a thorough understanding of how price movement, actual volatility, and implied volatility all provide a complex but workable web in which the informed trader can generate excellent returns. However, the trader must have the discipline to act within the confines of probability and the "law" of large numbers refusing to place trades based on gut feelings or hunches. Offers high-probability based trading that uses the new weekly options Contains handy interactive worksheets that allow traders to select their own risk/return with precision Includes a website with daily and weekly information on the estimate of the actual standard deviation points on the price spectrum Vertical Options Spreads offers traders a research-based guide for trading Standard & Poors 500 ETF, SPY using historic and estimated probabilities and returns that will give them an edge in the marketplace.

Option Spread Strategies

Option Spread Strategies PDF Author: Anthony J. Saliba
Publisher: John Wiley & Sons
ISBN: 0470885246
Category : Business & Economics
Languages : en
Pages : 292

Book Description
Spread trading—trading complex, multi-leg structures--is the new frontier for the individual options trader. This book covers spread strategies, both of the limited-risk and unlimited-risk varieties, and how and when to use them. All eight of the multi-leg strategies are here: the covered-write, verticals, collars and reverse-collars, straddles and strangles, butterflies, calendar spreads, ratio spreads, and backspreads. Vocabulary, exercises and quizzes are included throughout the book to reinforce lessons. Saliba, Corona, and Johnson are the authors of Option Strategies for Directionless Markets.

The Complete Book of Option Spreads and Combinations

The Complete Book of Option Spreads and Combinations PDF Author: Scott Nations
Publisher: John Wiley & Sons
ISBN: 1118806204
Category : Business & Economics
Languages : en
Pages : 278

Book Description
Get a handle on option spreads to hike profit and squash loss The Complete Book of Option Spreads and Combinations is the definitive educational resource and reference guide for using option spreads and other common sense option strategies. This useful guide shows readers how to select the right strategy for their market outlook and risk/reward comfort level by describing the inner workings of each strategy and how they are affected by underlying market movements, implied volatility, and time decay. Even more importantly, readers will understand where each strategy performs well, and the market conditions where each should be avoided. Once the proper strategy is selected, readers will learn how to identify the best options to use based on "moneyness" and time to expiration. The companion website features tools including an option pricing tool and implied volatility calculator to help all traders implement these concepts effectively. There are many different types of spreads, and while less risky than other option strategies in general, they are more complex, with more variables to monitor. This guide serves as a handbook for the trader wanting to exploit options to the greatest possible benefit. Generate monthly income by selling covered strangles Use call spreads to recover from a losing stock position Protect an existing stock position using put diagonals Discover the best strategies for directional market plays Option spreads are a great tool for traders who would rather be an option seller but who need to limit their risk. The Complete Book of Option Spreads and Combinations identifies those strategies that benefit from option erosion but that limit risk. If managed properly, spreads can provide both novice and experienced investors with the potential for a large return while limiting risk. Electronic trading platforms and reduced brokerage commissions have increased option spread trading, which should occupy a spot in every savvy investor's toolkit. Comprehensive and authoritative, The Complete Book of Option Spreads and Combinations provides a valuable manual and lasting reference.

Pricing Efficiency in the Long-term Index Options Market

Pricing Efficiency in the Long-term Index Options Market PDF Author: Anuradha Kandikuppa
Publisher:
ISBN:
Category : Options (Finance)
Languages : en
Pages : 250

Book Description