Wednesday, March 3, 2010

Re: [TheOptionClub.com] Re: butterflies

 

Bill,
 
I have had similar experiences and there while there are a plethora of books out there that will tell you how to put on a position and look great as a "chalk talk" in planning the trade to borrow from your sports analogy, when it comes time to adjust, or when the market is threatening the position they leave you guessing.
 
One book that doesn't do this is called "The Option Traders Handbook" by George Jabour and Phillip Budwick...I had a copy of the 1st ed that I loaned out to someone and they moved and I have not tried to recover it. I missed having it as a reference so I recently purchased the 2nd Ed which is now out. It's one of the few books out there that not only discusses how to implement strategies but also how to potentially adjust and morph the spread positions. 
 
So books by Salba that you mentioned, and others all can explain the How and why of choosing a strategy and how to put it on.....at the point in your trading plan that you need to adjust or morph the position Jabour's book becomes a very valuable reference.
 
As far as specific books on Volatility Trading I think that Augen's book is good but its not what I would call an easy read.

Cheers
 
 
 
 
--- On Tue, 3/2/10, Bill Fletcher <wnfletcher@hotmail.com> wrote:

From: Bill Fletcher <wnfletcher@hotmail.com>
Subject: [TheOptionClub.com] Re: butterflies
To: OptionClub@yahoogroups.com
Date: Tuesday, March 2, 2010, 5:00 PM

 

I have Saliba's book on spreads, which is pretty good.  The book discussed here doesn't get good reviews.  It is one of the few trading books I don't have!!  Most of these books tell you what to do when you are in the huddle, but not when the pass rush is on, and you are looking for a receiver.  (Not a bad analogy for an Englishman!)  We don't need more fancy spreads – they just move the lines around a bit on the risk graph.  What we need is a sense of "I am in a calendar, and my deltas have gone from 5 to minus 62, and I am sliding into the abyss.  What do I do?"  That kind of stuff.  I may sound like I know what I am talking about, but I am lousy at it.  There is a book called "Trading Option Greeks", which I left in the supermarket cart because it was my "standing in line" book and I forgot it.  I am currently back on Augen's Volatility Edge, which I didn't really understand the first time through.  Do any of you guys out there have an opinion on these?

 

Bill


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