Options Trading for the Institutional Investor · Managing Risk in Financial Institutions by Thomsett, Michael C. -- Read -- Imperial Library of Trantor

Index

About This eBook Title Page Copyright Page Contents Acknowledgments About the Author Preface

The Elusive Goal: Low Risk and High Yield Endnotes

1. Setting the Ground Rules

The Ground Rules A Model Portfolio

2. Option Basics

The Workings of the Options Contract Calls and Call Strategies Puts and Put Strategies Listed Options and LEAPS Options Coordinating Strategies with Portfolio Goals Option and Stock Volatility: The Central Element of Risk Trading Costs in the Option Analysis Tax Rules for Options: An Overview The Importance of Professional Advice and Tax Planning Endnotes

3. Options in Context

The Nature of Risk and Reward Perceptions about Options Short Positions: Naked or Covered Margin Requirements and Trading Restrictions Return Calculations: Seeking Valid Comparisons Long-Term Goals as a Guiding Force Exercise as a Desirable Outcome

4. Chart-Based Analysis

Criteria for Chart-Based Analysis A Study of Charts for the Model Portfolio Endnote

5. Managing Profits and Losses

Your Conservative Dilemma Managing Profits with Options Overcoming the Profit-Taking Problem Managing the Inertia Problem Taxes and Profits

6. Options as Cash Generators

The Covered Call Concept Examples: Ten Stocks and Covered Calls Working within Preestablished Standards Smart Conservative Ground Rules A Conservative Approach Tax Ramifications of Covered Calls Rolling Forward and Up: Exercise Avoidance The Exercise Acceptance Strategy Endnote

7. The 1-2-3 Iron Butterfly

The Iron Butterfly The 1-2-3 Iron Butterfly Concept The Hedge Matrix and Collateral Requirements Examples of the Strategy

8. The Dividend Collar

9. Alternatives to Stock Purchase

Leverage and Options The Long-Call Contingent Purchase Strategy The Covered Long Call Short Puts and Contingent Purchase Rescue Strategy Using Calls Rescue Strategy Using Puts Covered Calls for Contingent Sale

10. Option Strategies in Down Markets

Thinking Outside the Market Box The Long Put: The Overlooked Option Short Puts: A Variety of Strategies Using Calls in Down Markets Evaluating Your Stock Positions Stock Positions and Risk Evaluation Options and Downside Risk Option Planning with Loss Carryover Endnote

11. Combination Conservative Techniques

Spread Techniques Straddle Techniques Long or Short Positions Theory versus Practice Tax Problems with Combination Strategies The Ultimate High-Return Strategy Examples of the Strategy in Practice Outcome Scenarios The Augmented Strategy: A Short Straddle Rescue Strategies

12. Risk Evaluation Techniques

The Nature of Greed Risk A Range of Options-Related Risks Estimating Your Risk Tolerance

13. Stock Selection and the Option Contract

Remembering Your Conservative Profile as a Priority Dangers and Pitfalls in Using Options Temptation to Select Most Volatile Stocks Creating Sensible Conservative Standards Maintaining Fundamental Clarity The Importance of Taxes in the Option Equation Option Volatility to Judge Stocks

Glossary Appendix. Option Trading Strategies Index