And so it's Christmas ... and Hanukkah and Kwanzaa, and what better gift to give your loved ones than some thick tomes on options?
We've had many requests for ideas on how investors can educate themselves, and since it's the season of giving, it's worth going over some of the best resources.
Here's to the holidays, and keep the options questions coming to
And To All A Good Night
I need to learn about options and will have to rely on a book to accomplish this. Which do you recommend? I would like to learn it all, from the basic (simple mechanics of using options) to the advanced (how they are priced) to the subjective (best strategies). Ran Whittle
We all need to learn more about options, but you don't have to bury yourself in a dark corner of the library to do it.
Most options books can be very confusing, very quickly. The
Options Industry Council has pamphlets that explain the basics in a simple way. After digesting those, move on to the hardcovers.
There are also plenty of resources on the Internet (
Brad "Doc Options" Zigler
outlined many of them in a recent
Options Forum), and kind souls such as those at the Options Industry Council sponsor live-and-in-person seminars on real option exchange floors.
What with the advent of electronic options trading, it might be worth a visit just to tell the grandkids about it.
"Sonny, when I was your age trading options..."
By March, you should be ready for the big hitters.
We've mentioned him before, we
chatted with him this week: Bernie Schaeffer, chairman of
Schaeffer's Investment Research
, is also the author of
The Option Advisor: Wealth-Building Techniques Using Equity & Index Options.
DeMark On Day Trading Options is one of the newer additions to the options bookshelf, but daytrading by any other name is still dangerous.
The two bibles for options investors are Lawrence McMillan's
Options As A Strategic Investment and Sheldon Natenberg's
Option Volatility & Pricing.
Our old options guy,
, is a big fan of James Bittman's
Options for the Stock Investor because it connects basic investing ideas to options plays.
The Options Wish List
We asked, you responded.
At least one
subscriber got through with his eyes open perusing a recent
Options Forum and noticed a reader had asked where to find the implied volatility of an individual stock option.
So we've passed on a free, yes,
Web site for pricing options hosted by the
Philadelphia Stock Exchange
. We've tested it out here at Options Forum and it appears to be accurate.
Another reader stumbled upon
www.optionclub.com and found it to be "very helpful with any strategy you are considering." The site also has implied and historical volatility for most equity and index options, and could be used for a quick look or when you don't have time to load the Nobel laureate
model. It's also free.
Here's Some More Holiday Cheer:
Thanks for the column "A Lesson on Limiting LEAPS Losses." Regarding reader Bob Consigli's question on the volatility index's trading history, charts of the market's volatility (as well as numerical data) can be found on Yahoo!'s quote site. Ben Richter
In reference to your recent piece on put/call ratios Quote.com provides up-to-the-minute put/call ratios, one for the OEX and one for "All stocks." From its home page, punch in the symbol PUTCALL.OEX in the quote field to get an OEX put/call ratio quote, or just PUTCALL to get a put/call ratio for all U.S. stocks. It's not a perfect match to what the Chicago Board Options Exchange reports, but it gives a good estimate. Unfortunately, its servers seem to get bogged down and show blank charts, particularly over the weekend, but usually if you hit refresh a few times a missing chart will appear. This doesn't occur as much during the week, and the quotes themselves don't are not subject to this problem. Rennie Yang
does not vouch for or curry favor with one Web site or another.
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