13 Best Options Trading Books [Updated 2021]
To thrive in the present-day financial markets, one must consider the use of options in investment endeavours. In this article, we highlight the top 13 Best Options Trading books to read in 2021 that you may consider reading –
- Options as a Strategic Investment ( Get this book )
- Options Trading Crash Course ( Get this book )
- Trading Options For Dummies ( Get this book )
- The Options Playbook ( Get this book )
- Get Rich with Options: Four Winning Strategies Straight from the Exchange Floor ( Get this book )
- Options Trading: Quick Start Guide ( Get this book )
- Rogue Options ( Get this book )
- Options Trading in Your Spare Time ( Get this book )
- The Bible of Options Strategies ( Get this book )
- How to Make a Million Dollars Trading Options ( Get this book )
- Options Volatility and Pricing ( Get this book )
- The Complete Guide to Option Selling ( Get this book )
- Trading Options Greeks ( Get this book )
Let us discuss each of the option trading books in detail along with its key takeaways and reviews.
#1 – Options as a Strategic Investment
by Lawrence G. McMillan
About the book
The book tells you how listed options as well as non-equity option products provide you new and strategic opportunities for investment management. It also offers you the latest market-tested tools that can improve your portfolio’s earning potential while limiting its downside risk irrespective of the market performance.
It is one of the best qualitative books on options strategies available and it provides you a directional view of the market. It thoroughly explains the complex options investing topics in a very simple way. It also discusses how you can construct various classic options strategies and how these options work despite market movements. It covers hordes of business-tested tactics and proven techniques that you can employ while investing in innovative and fresh options products. The author has provided many examples and exhibits that help you understand the power of each strategy. After reading the book you will realize that there are multiple ways to earn profits using different options strategies irrespective of any possible market view.
- If you are planning to start trading options, then this a must-read for you as it serves as a guide as well as a reference book.
- This comprehensive book explains to you different concepts and applications of the available options strategies.
#2 – Options Trading Crash Course
The #1 Beginner’s Guide to Make Money With Trading Options in 7 Days Or Less!
by Frank Richmond
About the book
This book provides a brief overview of how options trading works in the real business world and explains some of the simple strategies for trading options.
The options market is very difficult to comprehend, especially for the novice trader. Basically, if you intend to start options trading, then you must build your understanding of what lies underneath the options market. In this book, the author explains various trading strategies and how you can utilize all of them to generate healthy profits. It also teaches you how to identify patterns in the market, how to recognize great investment opportunities, and how to make money out of them. At the end of the book, you will realize that understanding the fundamental principles of the options market is not that difficult as it appears from a distance.
- It can be an excellent guide for beginners as it explains the functioning of the options market from scratch.
- This book is a collection of several fundamental concepts put together in one place.
- It is a straight-forward, simple, and easily understandable book.
#3 – Trading Options For Dummies
by Joe Duarte
About the book
The book will help you select the right options trading strategies based on your investment needs. It will teach you to run the cost-benefit analysis for building a strategy that will always gain no matter how the market behaves.
The book is considered one of the best if you are interested in learning the fundamental principles and strategies of options trading. If you are a professional investor with some knowledge of trading, then this book can help you in gaining a better understanding of new techniques, associated risk factors, and profit profiles. Options trading can be an effective way of risk management and the author provides you the details explaining the same. The book covers a lot of information including technical analysis, Exchange Traded Funds (ETFs), and trading strategies that can be useful for you if you are planning to become a trader soon. Effectively, the author gives you enough theories that you can understand quickly and put into action.
- It is a comprehensive book about options trading, which can serve as a good reference book.
- This book is not best suited for beginners. You need some knowledge of trading to draw maximum benefits from the explanations provided in it.
#4 – The Options Playbook
by Brian Overby
The objective of getting this top Options Trading book into existence was to simplify option trading and offer guidance to the investors for trading under various market conditions. It covers more than 40 option trading strategiesOption Trading StrategiesOptions Trading refers to a situation where the trader can purchase or sell a security at a particular rate within a specific period. Its strategies include Long Call Options, Short Call Options, Long Put Options, Short Put Options, Long Straddle Options, & Short Straddle Options etc. broken down in intriguing plays, which will keep the readers engrossed and feel involved. The format of the play has been kept uniform, which will offer information on:
- Strategies considered and implemented
- Break-even at expiration
- Sweet Spot for trade execution
- Maximum Potential of making a profit or Loss
- A requirement of Margin Money
- Time constraints
- Implied VolatilityImplied VolatilityImplied Volatility refers to the metric that is used in order to know the likelihood of the changes in the prices of the given security as per the point of view of the market. It is calculated by putting the market price of the option in the Black-Scholes model.
This expanded edition consists of 10 new plays and 56 new pages of content describing:
- A brief history of options
- Five common mistakes made by options traders and how could they be avoided
- Expanded Glossary
- Explaining the difference between Index and Stock optionsStock OptionsStock options are derivative instruments that give the holder the right to buy or sell any stock at a predetermined price regardless of the prevailing market prices. It typically consists of four components: the strike price, the expiry date, the lot size, and the share premium.
- Managing early exercise and assignment
- It calculates position delta and its use to manage overall position risk in case of a multi-leg option strategy.
This Options Trading Book is framed in a very simplified but constructed manner, which is beneficial for new as well as experienced traders. It will cover up the basic definitions and concepts one is required to understand the market, especially for new traders, tips to avoid common beginner’s mistakes, and suggested strategies to get a good grip on the market.
In order to cater to the experienced traders, the emphasis is laid on Implied volatilityImplied VolatilityImplied Volatility refers to the metric that is used in order to know the likelihood of the changes in the prices of the given security as per the point of view of the market. It is calculated by putting the market price of the option in the Black-Scholes model. with a detailed section on the Option Greeks, which will help in understanding how option pricing gets impacted by changes in the market condition.<< Get this book >>
#5 – Get Rich with Options: Four Winning Strategies Straight from the Exchange Floor
by Lee Lowell
It is a trustworthy Options Trading Book rich with in-depth insights and expert guidance offering strategies and knowledge required for achieving optimal results within the options market. It will swiftly cover the basics before moving on to the four options-trading strategies, which have helped the author make profits in this arena over time. The strategies are:
- Buying Deep-in-the-money call options
- Selling Naked Put options
- Selling Credit Spread Options
- Selling of covered calls
This Best Options Trading Book is packed with real-life examples of actual trades and detailed discussions of how options can be used as a HedgingHedgingHedging is a type of investment that works like insurance and protects you from any financial losses. Hedging is achieved by taking the opposing position in the market., Speculating, or income-producing tool. It will broadly cover up:
- A detailed operation of the above-mentioned strategies.
- Explaining how to set up a home-based business with the best options trading software, tools, and websites.
- A detailed discussion of how Delta and Volatility can be used to the advantage of the trader.
#6 – Options Trading: Quick Start Guide
by ClydeBank Finance
This Best Options Trading book is a straight forward premier with a lot of information packed into an easy to read book. It walks the readers through a multitude of strategic trading decisions, displaying how a trader thinks and how they arrive at resolving critical decisions. It motivates the trader to be ambitious and become a formidable, sharp, and cunning options trader. The chapters in this Options Trading book include:
- Basics of OptionsBasics Of OptionsOptions are financial contracts which allow the buyer a right, but not an obligation to execute the contract. The right is to buy or sell an asset on a specific date at a specific price which is predetermined at the contract date.
- Trading Fundamental pertaining to Call and Put options
- Sound Options Trading StrategyOptions Trading StrategyOptions Trading refers to a situation where the trader can purchase or sell a security at a particular rate within a specific period. Its strategies include Long Call Options, Short Call Options, Long Put Options, Short Put Options, Long Straddle Options, & Short Straddle Options etc. for Beginners
- Key influencers on the pricing of options
- Importance of Option Greeks
- Popular and Complex options strategies under various market conditions.
Whether the reader is a newcomer to options or an established veteran looking for a fresh take on basic strategy, the plain-spoken style, and colorful scenarios will keep the readers engrossed and motivated to gain more knowledge.<< Get this book >>
#7 – Rogue Options
This Top Options Trading book will teach how traders can make money online by trading of options with fine details and clear images supplementing the information provided. One need not have a finance or technical background for implementing these techniques and can be done by anyone who wants to make money through online trading.
The author delves deep into the many options strategies highlighted for consistently making money online. Exact details are provided from what each trade does to how it is required to be set up within the trading software. Step by step instructions with screenshots is included to make it easy to follow instruction manual on profitable trading strategies. The author is confident of traders gaining success in the options market with an investment of as low as $50 though it is not a guaranteed approach.
Most of the readers who are traders have highly appreciated the contents of this book and can be implemented in most of the option strategies under various conditions. It comes with a number of Scanning setups to be used in ThinkorSwim which is one of the leading trading platforms and Free to be used as a part of this top options trading book. Hence, it will not only sharpen the practical knowledge but also the way the trading platform needs to be handled gets improvised.<< Get this book >>
#8 – Options Trading in Your Spare Time
by Virginia McCullough
This book on Options Trading is geared specifically towards women, describing and encouraging them to be successful options traders despite holding a full-time job or being a full-time housewife. The primary focus is executing trades online and communicating what is required to know for being a successful trader. It offers a step by step guide in an easy to understand language for beginners as well as advanced investors.
Though option trading is not a risk-free method of investment, for women who have limited spare money to be utilized towards investing, options trading can be a very lucrative method to make money.
Neat and tidy charts and candlesticks have been regularly shown, which makes it interesting, especially for beginners, to have an understanding of the performance of the options. Excellent guidance has been offered towards the Buying of Calls and Puts. Few other caveats have been identified by the readers, such as making the charts more colourful or including some other strategies which could have made it more interesting but overall, it is a definite read for someone who desires to take explore the market with a limited risk appetiteRisk AppetiteRisk appetite refers to the amount, rate, or percentage of risk that an individual or organization (as determined by the Board of Directors or management) is willing to accept in exchange for its plan, objectives, and innovation..<< Get this book >>
#9 – The Bible of Options Strategies
by Guy Cohen
Options Trading Book Review
This book on Options Trading is a practical module from start to end, offering guidance on how flexible and advantageous option trading can be. It has an easy to understand language with simple examples easily cross-referencing so that one can find what is required quickly and take advantage of opportunities even if they are short-lived. All the major areas which are essential to know while indulging in options strategies have been covered up by the author.
The author has very successfully explained most of the complex techniques in a smooth manner, making them easier to understand for any trader even with modest experience in the trading of options. Apart from offering exquisite value, it is a definitive reference to contemporary options trading. Some of the critical aspects are:
- Control more amount of assets for a limited amount of money
- Trade with leverage
- Trade for a substantial amount of income
- How to make a profit from declining stocks
- Reduction or elimination of risks
- Profit from volatility or protection against a variety of factors
A number of aspects with respect to explaining details of option spreadsDetails Of Option SpreadsOptions Spread are strategies used to trade options in the financial market. They belong to the same class of underlying security. The expiration date and the strike price are different and the difference between the strike prices is the spread position., how to use them, selection of stocks along with their benefits and drawbacks have been successfully highlighted and acknowledged by a number of readers and trader.<< Get this book >>
#10 – How to Make a Million Dollars Trading Options
by Cameron Lancaster
This book on Options Trading is a relatively short read, but the author has done an exceptional job teaching the readers how to trade options?How To Trade Options?Options Trading refers to a scenario when the trader can buy or sell the stocks within a specific period & at a specific rate. You can trade options through Brokers, Self-Investments, or with the help of Standardized Platforms. With ease. The truth about the trading of options and making money is clear and simple. It exposes the secret of options which have been hidden by the Wall Street. It highlights the fact that options do not fairly reflect the chances of the stock going up or down, and put/call parityPut/call ParityPut-call parity theorem says that a call option's premium (price) implies a specific fair price for corresponding put options, provided the put options have the same strike price, underlying and expiry, and vice versa. It also shows the three-sided relationship between a call, a put, and underlying security. can be exploited.
The important concepts highlighted are:
- Basics of Options
- Volatility / Put-call parity
- Expected ValueExpected ValueExpected value refers to the anticipation of an investment's for a future period considering the various probabilities. It is evaluated as the product of probability distribution and outcomes. of Options Contracts
- Risk Management and Trade Sizing
- Where and how to source of trades
- Additional bonus tips on trading
- Reasons why option traders are losing money
It is an interesting book on options trading, which has been highly recommended by a number of traders around the world who are new or even experienced in this field. It was known to be controversial since it was e-mailed to Wall Street hence was printed to the outer world.<< Get this book >>
#11 – Options Volatility and Pricing
by Sheldon Natenberg
Options Trading Book Review
This best options trading book has been recognized as one of the best sellers for the new professional traders as they are given to learn the trading strategies and various techniques of risk management essential for success in the options markets. It offers a comprehensive guide covering a wide range of topics as diverse and exciting as the market itself, including the following aspects:
- The foundations of Options Theory
- Dynamic Hedging
- Risk AnalysisRisk AnalysisRisk analysis refers to the process of identifying, measuring, and mitigating the uncertainties involved in a project, investment, or business. There are two types of risk analysis - quantitative and qualitative risk analysis.
- Volatility and Directional Trading strategies
- Volatility Contracts
- Management of the positions which are held.
One can gain a complete understanding of how the theoretical pricing techniques are implemented in the practical models which are in use. The traders can also apply the principle of option evaluation for creating strategies that have the greatest chances of success given a trader’s assessment of market conditions. This options trading book stresses the fact that options trading is a science and an art and how one can extract the maximum benefit out of them.<< Get this book >>
#12 – The Complete Guide to Option Selling
by James Cordier/Michael Gross
Making any kind of investment has taken a giant leap over the past few decades. The strategy of buy and hold has now been replaced with buy and hope. A wide array of factors can now have a widespread impact on the performance of the investment. An investor needs to consider all the macroeconomic factors before committing or growing any kind of investment. This guide will take a leaf from the pros of and radically change the entire philosophy towards building a robust and high-yielding portfolio.
A step by step guide is provided throughout the entire process for helping to earn steady and high profits even under choppy market conditions. Some of the important aspects which this best options trading book will focus on are:
- Fundamentals of Option Selling
- Option-Selling as a Strategy and its associated Risk Management
- Analysis of Markets and Writing of Options
It stresses the fact that selling options are less stressful and excusable than traditional and direction trading strategies. Not much reference has been made about Greeks or complex mathematical calculations, making it more practical and less theoretical. It also will briefly mention seasonality and utilization of fundamentals for commodity futures and others. Selling premium is a regular strategy in getting a niche in the market as it puts probability on the side of the trader.<< Get this book >>
#13 – Trading Options Greeks
by Dan Passarelli/William Brodsky
The overall options market is highly dynamic and challenging, and the traders must have the knowledge of the Option Greeks for the valuation of options and execution of trades regardless of market conditions. These Option Greeks include:
- GammaGammaGamma of an Option is the range of the change in the delta of an option in response to the unit change in the price of the underlying asset. Gamma can be expressed as the second derivative of the premium of the option with respect to the price of the underlying asset.
- RhoRhoRho refers to the metric used for assessing the sensitivity of an option to the changes in the risk-free interest rate. It shows the amount of money that an option would either gain or lose if the risk-free interest rate changes by 1%.
These tools are kept in perspective for both aspiring and professional traders offering an explanation in a straightforward and accessible style. It will skilfully highlight how trading strategies can be used for gaining profits from aspects such as Volatility, Time Decay, or changes in the rate of interest. It also makes use of New Charts and examples with discussions on how the proper application of these Greeks can lead to the accuracy of pricing and trading while also offering alerts to a range of other opportunities.
All of these option Greeks are interdependent on each other and play a vital role in determining the price of an option. In a crunch market scenario, it is these Option Greeks that need to be taken advantage of, and at times, it is the trading pulse that can decide the future course of the investment. It also offers advice on investments to be made through spreads, put-call parity, synthetic options, trading volatility, and advanced options trading.
Additionally, it holds pertinent new information on how accuracy in pricing can be a driving force of the profits earned.<< Get this book >>
Here is the guide to Options Trading Books. Here we provide the list of top 10 options trading books & a sneak peek in what those books reviews & key takeaways. You may refer to the following books to learn more –
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