Get Rich with Options: Four Winning Strategies Straight from the Exchange Floor

272 Pages·2009·7.51 MB·english

by  Lowell

7700++ DDVVDD’’ss FFOORR SSAALLEE && EEXXCCHHAANNGGEE

wwwwww..ttrraaddeerrss--ssooffttwwaarree..ccoomm

wwwwww..ffoorreexx--wwaarreezz..ccoomm

wwwwww..ttrraaddiinngg--ssooffttwwaarree--ccoolllleeccttiioonn..ccoomm

wwwwww..ttrraaddeessttaattiioonn--ddoowwnnllooaadd--ffrreeee..ccoomm

CCoonnttaaccttss

aannddrreeyybbbbrrvv@@ggmmaaiill..ccoomm
aannddrreeyybbbbrrvv@@yyaannddeexx..rruu
SSkkyyppee:: aannddrreeyybbbbrrvv
ffffiirrss..iinndddd iiii 88//1144//0099 11::3399::2255 PPMM
GGeett rriicchh
wwiitthh ooppttiioonnss
ffffiirrss..iinndddd ii 88//1144//0099 11::3399::2244 PPMM
ffffiirrss..iinndddd iiii 88//1144//0099 11::3399::2255 PPMM
ggeett rriicchh
wwiitthh ooppttiioonnss
Second Edition
Four Winning Strategies
Straight from
the Exchange Floor
LEE LOWELL
John Wiley & Sons, Inc.
ffffiirrss..iinndddd iiiiii 88//1144//0099 11::3399::2255 PPMM
Copyright © 2009 by Lee Lowell. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form
or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except
as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either
the prior written permission of the Publisher, or authorization through payment of the appropriate
per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923,
[phone], fax [phone], or on the web at www.copyright.com. Requests to the Publisher
for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River
Street, Hoboken, NJ 07030, [phone], fax [phone], or online at www.wiley.com/go/
permissions.
Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts
in preparing this book, they make no representations or warranties with respect to the accuracy or
completeness of the contents of this book and specifi cally disclaim any implied warranties of
merchantability or fi tness for a particular purpose. No warranty may be created or extended by sales
representatives or written sales materials. The advice and strategies contained herein may not be suitable
for your situation. You should consult with a professional where appropriate. Neither the publisher nor
author shall be liable for any loss of profi t or any other commercial damages, including but not limited to
special, incidental, consequential, or other damages.
For general information on our other products and services or for technical support, please contact our
Customer Care Department within the United States at [phone], outside the United States at
[phone] or fax [phone].
Wiley also publishes its books in a variety of electronic formats. Some content that appears in print may
not be available in electronic books. For more information about Wiley products, visit our web site at
www.wiley.com.
Library of Congress Cataloging-in-Publication Data:
Lowell, Lee, 1967-
Get rich with options: four winning strategies straight from the exchange fl oor/Lee Lowell.—2nd ed.
p. cm.
Includes index.
ISBN 978-0-470-44589-1 (cloth)
1. Options (Finance) I. Title.
HG6024.A3L69 2009
332.64’53—dc22
2009032181
Printed in the United States of America
10 9 8 7 6 5 4 3 2 1
ffffiirrss..iinndddd iivv 88//1144//0099 11::3399::2255 PPMM
To my wife, Amy, and my three children—
Sydney, Josie, and Griffi n—all whom I
love more than anything in the world
ffffiirrss..iinndddd vv 88//1144//0099 11::3399::2255 PPMM
ffffiirrss..iinndddd vvii 88//1144//0099 11::3399::2266 PPMM
CONTENTS
Preface to the Second Edition ix
Acknowledgments xiii
Part One: T he option basics 1
CHAPTER 1: It’s All about the Calls and Puts 3
CHAPTER 2: How Options are Priced 15
CHAPTER 3: Option Volatility 27
CHAPTER 4: Stocks versus Options 47
CHAPTER 5: Option Selling Is Your Key to Success 57
Part Two: The strategies 69
CHAPTER 6: Buy All the Stock You Want for Half the Price 71
CHAPTER 7: Getting Paid to Buy Your Favorite Stock 93
CHAPTER 8: Option Credit Spreads: The All-Star Strategy 121
CHAPTER 9: A Day in the Life of the Market Maker 173
vii
ffttoocc..iinndddd vviiii 88//1144//0099 11::4400::4400 PPMM