Trading Software and Books Reviews

Trading Options – The ASX Way

This book is directed at the confident share investor, as it opens the door to the world of options.

Have you ever been curious about options but too scared to ask? If so, there’s no need to continue worrying, because this book is for you. It’s an excellent introduction to options.

Part One begins with the basics of buying and selling call and put options. Each major factor that has an impact on option prices is explained with clear and easily understood payoff diagrams.

Part Two deals with option trading strategies. It begins with a good explanation of option pricing models, margins, volatility and the Greek (no, it’s not a Latin lesson). The book then dives into strategies, starting with writing covered calls. By the end, the reader is well familiar with spreads, straddles, strangles and synthetics. Each strategy is clearly explained with its own easy to follow payoff diagram.

If you’re a confident share investor, then options are certainly worth studying. Like the earlier books in The ASX Way series, this book is well written and easy to follow. And, like the other books, it won’t let you down if you’re looking for a good book on options that is more than just an introduction.

As a final word, I think Paul Dolan and his Investor Education team at the ASX should be congratulated. As I understand it, the three books comprising The ASX Way series originally consisted of six titles that had evolved over the years. Paul and his team, with the help of Wrightbooks, have been able to compile and distil the information into three well-written and concise books. The ASX Way series is the accumulation of many years of effort, allowing readers to benefit from both the ASX’s experience and its authority.

This article was originally published in the Sep/Oct 07 issue of YourTradingEdge magazine (www.YTEmagazine.com). All rights reserved. © Copyright 2009, MarketSource International Pty Ltd.

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