Options as a Strategic Investment

by Lawrence G. McMillan

Reflecting today’s market realities and the new innovative options products available, this fourth edition features an in-depth analysis of volatility and volatility trading; updated information on all stock option strategies, reflecting recent market conditions; buy and sell strategies for Long Term Equity Anticipation Securities (LEAPs); detailed guidance for investing in the growing field of structured products; the latest developments in futures and futures options; and the market impact of the most recent changes in the margin rules. Packed with graphs and charts to clarify profit and loss potential, margin requirements, and criteria for selection of a position, this classic remains an indispensable resource for investors determined to master the world of options--and profit.

Genres: Finance, Business, Nonfiction, Reference, Personal Finance, Money, Economics

Hardcover

First published January 1, 1980

Reviews

[Austin · Rating 4 out of 5]

This book and that of Natenberg (Option Volatility & Pricing Advanced Trading Strategies and Techniques) are the two best qualitative books on options and options strategies available. Whereas Natenberg focuses a little bit more on the volatility trader, McMillan targets the trader with a complex directional view of the market. Thorough discussions of the characteristics of standard options spreads are discussed, including possible adjustments to the positions as conditions change. More than anything, I have a soft spot for this book because reading it was the first time I realized that there is a way to profit from any possible view of the market that you might have (multiplying many times the myriad of ways in which the just-clever-enough-to-be-dangerous young man can lose money). In many ways, this book (and Phil Town's Rule No.1 The Simple Strategy for Successful Investing in Only 15 Minutes a Week!, I'm embarrassed to admit) are where it all started for me...

[Matthew · Rating 2 out of 5]

Probably good to have as a reference text since its supposed to be the Options Bible but I can't say I got too much insight out of this. Admittedly I skipped sizable chunks of it, such as the advanced mathematical strategies which aren't relevant to me at this stage. My main beef is with the organisation of the book: it first runs through various call strategies, quite thoroughly with respect to discussing delta and a bit on theta, but not really touching on the multi-dimensionality of vega/gamma. Then, separately, he runs through put strategies -- but many of these are structurally similar to the call strategies earlier discussed, so why not put them together rather than having all these extra pages in a 1000 pager? Then, right at the end, he discusses volatility. Fine, but volatility should be an integral part of the discussion of options right from the beginning, and given that he discusses trade ideas in case studies all the way through, volatility should be a key part of that discussion from the beginning, given how much option values depend on IV. In short I think the text could be much tighter, better integrated and practically written.

[David]

This describes a fundamental component of investments and financial management - the basis of "hedging" a stock position. Even well considered stock positions may be wrong, but with the right backstop an investor may still make a profit.

I consider it an essential companion to "Security Analysis" by Graham and Dodd.

[Mikel C. · Rating 4 out of 5]

The essential guide and reference book for anyone planning on trading options.

[Gangadharan · Rating 5 out of 5]

Very good book. Now I've good idea about options

[Billy Polk · Rating 5 out of 5]

"Options as a Strategic Investment" is nothing short of a trading bible for anyone interested in options. The level of detail in this book is unparalleled, making it an invaluable reference guide for traders at all levels. From cover to cover, it offers a comprehensive look into the world of options, breaking down complex strategies into understandable terms.

What sets this book apart is its exhaustive list of option types, each explained with the kind of depth that only an expert could provide. Whether you're a novice trader or a seasoned veteran, this book serves as a go-to resource for understanding the intricacies of options trading.

I find myself continually returning to this book, especially on slow market days. It's the kind of book that you'll want to keep within arm's reach, serving as both a quick reference and a deep dive into the world of options trading.

In summary, "Options as a Strategic Investment" is a must-have for anyone serious about trading options. It's a treasure trove of knowledge that you'll find yourself coming back to time and time again.

[Tony Samuel · Rating 5 out of 5]

This book is incredibly thorough on the topic of options. A beginner definitely should watch relevant youtube videos to become more acclimated with the subject beforehand. In this edition he added a chapter on volatility derivatives and it really helps what makes this 2012 edition still highly relevant for the new type of investing.

[Ondrej · Rating 5 out of 5]

Very extensive and detailed book, even as an experienced option trader I learnt a lot and got extracted golden nuggets from it. Price for the value is crazy high as every trading guru would sell you 20 pages of knowledge for 10times more.

[Manoj · Rating 4 out of 5]

Awesome book for option traders

[Oleksandr Gerasymovych · Rating 4 out of 5]

The book helped me to understand better binary options.

[Shravan Kumar · Rating 5 out of 5]

One of the best books on the subject. Excellent explanations and I am going to go back to it again and again

[Jack Zuber · Rating 4 out of 5]

An informative resource.
Took what I needed and skipped that which did not pertain to me.
A great beginner/intermediate read but also a resource that I will likely reference in the future.

[Shahar · Rating 2 out of 5]

Repetetive

[Niranjan · Rating 3 out of 5]

Partially read this book , fast read most of the chapters . Got some good ideas out of it.

[Rahul Kumar · Rating 4 out of 5]

Good book for learning about options

[Ted Whittier · Rating 5 out of 5]

Great as a reference

[Oliver · Rating 5 out of 5]

Solid, thorough - yet accessible - on options.

[Ethan J · Rating 4 out of 5]

classical and comprehensive

[Kevin Brunnock · Rating 4 out of 5]

This book delivers a comprehensive and detailed exploration of options strategies suited for serious traders. The in-depth examples are good to read.

[Kirk Bozeman · Rating 4 out of 5]

A very helpful book on options strategy mechanics, though I don't necessarily agree with many of the author's conclusions on trading them. He consistently takes a very negative view of the risk level of certain strategies and seems to advise against them, while not addressing the positive relationship of risk level to high probability of success. This is a very good book on how classic options strategies are constructed and work themselves out in the movements of the market, but you will have to look elsewhere for good advice on implementing these techniques.

[Raymond · Rating 5 out of 5]

Classic. As a novice, I only understand about half.

Will revisit as I gain more options experience and knowledge

Noteworthy topics

- Call buying selection crteria
- Ratio call writing
- Spreads
- Put buying & selling
- LEAPS - Pricing vs speculation buying
- Structured products - How Ibank structuring desk makes $
- Tax consideration - Capital gains for short/long term options

[Andy Hendriawan · Rating 2 out of 5]

still trying to understand, but it's a good opportunity for investors to achieve financial freedom..

[Dave Wysochanski]

I have not read this book in its entirety but use it as a reference.

[David · Rating 2 out of 5]

Scary stuff ...

[John Alsdorf · Rating 4 out of 5]

A classic for anybody who might want to consider using Puts or Calls (or, more importantly, some of the myriad combinations thereof) as part of their investing strategies.