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Using Options to Buy Stocks: Build Wealth With Little Risk and No Capital ePub download

by Dennis Eisen

  • Author: Dennis Eisen
  • ISBN: 0793134145
  • ISBN13: 978-0793134144
  • ePub: 1432 kb | FB2: 1944 kb
  • Language: English
  • Category: Investing
  • Publisher: Dearborn Trade Pub (February 1, 2000)
  • Pages: 338
  • Rating: 4.2/5
  • Votes: 159
  • Format: azw rtf doc lrf
Using Options to Buy Stocks: Build Wealth With Little Risk and No Capital ePub download

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In his book, Dennis Eisen describes exactly one way to trade options: Selling Puts, namely LEAPS (Long-term Equity .

In his book, Dennis Eisen describes exactly one way to trade options: Selling Puts, namely LEAPS (Long-term Equity Anticipation Securities). What makes this book so interesting to read is that Eisen starts with a general overview and then goes into a level of useful detail which I have not seen in any other book on options yet. He explains how options are taxed, how the margin requirement is calculated, and what actually happens when options are exercised/assigned. This knowledge you normally have to acquire in years of practice but Eisen just spreads it out in front of the reader

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This text explains in detail how long term stock investors can use options to generate thousands a month in premiums, implement newly developed strategies and hedge against unexpected market fluctuations.

This text explains in detail how long term stock investors can use options to generate thousands a month in premiums, implement newly developed strategies and hedge against unexpected market fluctuations. In his book, Dennis Eisen describes exactly one way to trade options: Selling Puts, namely LEAPS (Long-term Equity Anticipation Securities).

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Paths to Wealth Through Common Stocks.

Thread starter bonnie1234.

Building wealth with the stock market has always been a possibility, but . The cool thing about all these options is that I know people who have built real wealth with each

Building wealth with the stock market has always been a possibility, but what if you prefer to hedge your bets and invest elsewhere as well? This post goes over the top ways to build wealth outside the stock market and on your own terms. There are several ways to become a real estate investor without having to manage a property. The cool thing about all these options is that I know people who have built real wealth with each.

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Instructs you on how to generate thousands of dollars a month in premiums to add to stock positions without using your own money. Softcover. DLC: Stock options.
Dozilkree
This is one of the most misleading books I've come across. The entire approach developed by the author is based on one assumption - the bull market will continue and it will bail you out. To prove the validity of his approach he selected 1987 - 1997, the greatest bull market in history, when DJI increased 300%. This is the only reason why his strategy "worked." It's hard to believe that a trained mathematician didn't realize that the data he was using was flowed and didn't include a long enough bear market. If he had used a period from 1964 to 1984 instead, his calculations would have shown him a huge loss and this book would have never be published.

For those who are still thinking about trying selling at-the-money LEAPS, I would suggest reading The Black Swan by Nassim Taleb first.
WUNDERKIND
Jim Rogers, George Soros' former partner, onced admonished against the use of put writing, a financial instrument which brought him catastrophic losses early in his extraordinary career. Of course, LEAPS puts did not exist at the time Rogers was making use of them, and one wonders what he might think, or might have done, with Dennis Eisen's book, which makes a compelling case for LEAPS put writing.
This book is a singular, well conceived investment strategy lesson in several respects. It's rare that such a book can captivate an audience of beginning, intermediate and advanced investors, but I suspect investors of just about any caliber will find this worthwhile reading. That is to say, most readers will likely find something new here about calls and puts (both the regular option and LEAP flavors), although the author does well to stick more or less exclusively to LEAPS put writing. Also, the author uses historical runs to substantiate the tactics he's advising, which make his claims all the more informed and interesting.
Eisen addresses the key issues of rate of return, risk, and probability exceedingly well, and he contributes something altogether new to the field --probability tables, based on an issue's earnings growth and volatility. The author also addresses the proper allocation of margin, option taxation, and gives a decent explanation of option volatility. The book's essential and recurrent theme is that LEAPS puts tend to completely disregard an underlying issue's earnings growth potential.
The book's essential shortcoming is that its underlying option pricing formula, which accounts for stock dividends and American style options unlike the European-styled Black-Scholes model, is delineated for copy in the text as a BASIC program rather than as an EXCEL spreadsheet. Unless the reader is using BASIC, which seems unlikely to me, he or she will find the awaiting transcription task a substantial chore. And the volatility calculation Eisen suggests is based on a year's worth of an underlying issue's price data. The book might have included a macro spreadsheet for all of the requisite data and calculations, or the author might have made such a spreadsheet available for extra cost, which I --and I am sure many others-- would gladly pay.
Vonalij
Great experience
showtime
After reading this book I first wanted to give it 2*, but that would not be suited given the amount of work the author has put in this book. The whole document is an illustration of a research project the author has done. He wants to see if it's saver to systematically short put options on LEAPS to view if this gives a better risk/reward ratio than just buying and holding stocks. He uses some criteria to select safe stocks (part of these criteria are stock ratings bij rating agencies). The conclusion of his research was not a surprise to me, nor that impressive.

If this is your first book on shorting put options on stocks you want to own, you might give it a try. The author has very well documented his research in this book, which is somehting very rare in trading books, and he deals with his research question in a scientific way. My only complaint is that this book doesn't offer any help on trading put options/stocks. Nor did I get an insight in how to improve my tactics from this author. I suppose that was not what the author had in mind while writing this book.
Cae
I saw this book in the book store, and spent some time there reading the first few chapters. I was so interested in his ideas, that I purchased the book. It's well-written and not at all dry, unlike some other investment books.
The author starts off by telling us how he had been able to amass a decent-sized portfolio over the years. He had a couple of hundred thousand dollars saved away, all invested in good long-term stock investments. He wished there was a way he could generate more income on-top of his already solid investments.
He started out by selling covered calls on some of his stock portfolio. That worked for a while, but he soon became frustrated that some of his best performing stocks were being called away, while he was left with a portfolio of poorly performing stocks. That is one of the down sides to covered call investing.
So he tried selling put options instead. Selling a put option is when you promise to purchase a stock at a specific price. In exchange for this promise you get paid a premium up front.
The author has found a lot of success picking solid companies, with sales and earnings growth, and selling put options one or two years out (LEAPs). Most of the LEAP puts he sells expires worthless, thus allowing him to keep the premium as profit, and sell some more long-term puts for more premium.
Most of the book deals with his back-testing data for this theory. He tests different quality stocks, different expiry dates, and different strikes. All in an effort to find the best overall results. In the end, some of his data suggests that selling long term puts at a strike price below the current price on the highest quality stocks has a 95% plus success rate.
If this type of theory interests you, I suggest getting this book and studying the theory and data for yourself.
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