Option Trading From Basics For Beginners to Advanced

By Gradient Publication

The Book teaches right from the basics to advanced concepts in options trading. This is designed keeping in mind the Indian markets to teach the concepts (Nifty, Bank Nifty, NSE, BSE) . The examples used will have reference to Indian stocks and indices. We will be covering the following topics -

Learn the basics of options.

• Language: English
• Publisher: Gradient Publication
• Release date: Nov 12, 2023
• ISBN: 9798868994838

Book preview

Copyright

First published in 2023

© 2023 by Gradient Publication

All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any form or by any means, including photocopying, recording, or other electronic or mechanical methods, without the prior written permission from the publisher. By request, names and certain details in stories and examples have been anonymized to conceal identity.

Option Trading from basics for Beginners to Advanced

Substantive editing by Gradient Publication; copy editing, cover design, and typesetting by Gradient Publication.

Although the author has made every effort to ensure that the information in this book was correct at the time of publishing, and while this publication is designed to provide accurate information on the subject matter covered, the author assumes no responsibility for errors, inaccuracies, omissions, or any other inconsistencies herein, and hereby disclaims any liability to any party for any loss, damage, or disruption caused by errors or omissions, whether such errors or omissions result from negligence, accident, or any other cause.

The author makes no guarantees concerning the level of success you may experience by following the advice contained in this book, and you accept the risk that results will differ for each individual.

Table Of Contents

Copyright

Table Of Contents

About

Who is this book for?

Golden Rules

Who this book is for

The Most Fundamental Choices

Why Sell Options?

Creating a Wide Perspective of the Market

Size of Positions

Strategies and Management for Options

Concluding Remarks on Hedging

Tools Utilized Python, Amibroker

About

The Book teaches right from the basics to advanced concepts in options trading. This is designed keeping in mind the Indian markets to teach the concepts (Nifty, Bank Nifty, NSE, BSE) . The examples used will have reference to Indian stocks and indices. We will be covering the following topics -

Learn the basics of options.

●  CALL and PUT option concepts

●  Option Chain concepts

●  Candlesticks and its use

●  Option greeks - Theta, Gamma, Delta, Vega, etc.

●  Option Strategies

●  Margin and Risk Management

●  Adjustment Techniques

Who is this book for?

●  Newbie to Options and want to master it.

●  Has vague ideas and tried options with little knowledge.

●  Has some confusions on options trading

●  Has some basic knowledge on stock market and investing

●  Burnt fingers doing options trading

●  Money, Risk and Profit/Loss management

●  Adjusting the trading when tide is against you

●  Discipline in trading and build wealth

●  If you are a full time options trader, then this course is not intended for you.

Golden Rules

●  Do not try to trade based on predicting the market. You will never be able to predict the direction of the beast.

●  Risk Management is key.

●  It is okay to come out with less profit than booking a huge loss.

●  Aim reasonable returns 2-5% per month. If you are dealing with anything more, then you are riding a tiger.

●  Keep it simple. Do not complicate trading with technical charts and analysis. You don’t need them.

●  Always be prepared for the worst possible twist.

Who this book is for

●  Beginners interested to learn Option Trading from the basics to advanced topics

●  Passion to learn the ways to be successful with options trading

●  Passion to understand means to generate wealth through options trading

The Most Fundamental Choices 

I want to be clear. This book is not meant to be an introduction to option trading. You need to know the definitions of put and call options, among other terms. I was lured to option selling, like are many traders, after experiencing losses in all types of trading. I wanted the exact opposite of what option selling offered, which was a scenario of limited profit and infinite loss from the beginning.

I lost money trading stocks, then futures, then buying and selling options. I studied books about trading options and technical analysis. To learn how the stock market operates and how I may profit from it, I visited a lot of forums. Everything fell short. I then began paper trading on Excel while working my day job, and after three years of diligent paper trading, I eventually figured out how to trade options profitably. It wasn't simple. It caused pain. It was melancholy. What sustained me?

I understood from a distance that stock market trading was my calling and that I had to be good at it. I have read a lot of books during the past 12 years. Every book is the same. Tale of the Merchant. such as this technical analysis. Option Greeks must be comprehended and put to use. With time, I will choose a book, and if after the first fifty pages I am still not sure what I'm reading, I will put it down. Time was wasted on it. I required an exact book. What was the market's overall perspective? How is it traded? How much is there to trade? What should I do if something goes wrong? How can one endure for an extended length of time? Can you scale it? I'm going to tell my readers about this. How I utilize my prior transactions and the reasons behind them to show how I use options as a tool for generating income and positive cash flow. This is not material for a novice.

I anticipate that readers are familiar with fundamental alternatives. They ought to be aware of the differences between a put and a call option. They ought to understand what an open interest is. I also have to advise them on how to turn a profit after that. This is a straightforward, quantitative approach to option trading with the goal of averting a large loss and turning a profit along the way. I won't discuss topics that you can easily obtain online. Over the journey, I have learned about this and adjusted it to suit my needs.

This book's content was thoughtfully created by myself. I advise you to read this entire book cover to cover. All things are interrelated. There are several books available on option strategies, but none of them adequately prepares you for managing and executing the transaction. This book bridges the gap in that regard. It will lay the foundation for you to carry out a deal from A to Z. I'm making it available to everyone so that everyone may learn how to trade options profitably from one exact book.

Fundamentals of Options I will be posting screen grabs of trades or charts that I have previously utilized throughout this book. I use Excel to track my trades so I can stay informed about the positions I own. It offers a number of benefits:

Maintaining a journal allows you to reflect on and grow from your mistakes. I advise you to follow suit.  2. Understanding your positions and how they are impacted by shifting volume and prices is crucial while trading. While there are numerous places where you may keep track of your trades, Excel performs these computations exceptionally well. Three. I'll be utilizing my own Amibroker setup and charts from TradingView. 4. The majority of the tactics center on index