Book Description
"Put Option Writing Demystified" is the only book devoted exclusively to the subject of generating double-digit income returns from a little-known, often misunderstood and conservative investment opportunity known as "put option writing." In fact, it can be more conservative than simply owning stocks alone. And the good news is that this strategy works best during slow growth, flat or even slightly declining markets. This book fully stands on its own merits, but it can also be viewed as a companion text to "Covered Call Writing Demystified" (see the book description on Amazon.com for more information). Hence the similarity in name. These are the reasons:
* Put option writing and covered call writing have essentially the same reward and risk characteristics…When used as outlined in the book, they are very conservative (unlike other uses of options)
* Investors using covered call writing will find opportunities to use put option writing to achieve similar double-digit investment results, but also to have the opportunity to purchase stocks or Exchange Traded Funds at a discount from their present value.
* The put option writing and covered call writing strategies can both be used within the same portfolio to achieve similar results by differing means, depending on the investor’s objectives regarding the individual stock or ETF in question.
What is put option writing?
Have you been tempted at times to buy a particular stock, but decided not to take the plunge because you thought it might be overpriced…or, just on a hunch, you thought you might be able to pick up the shares at a lower price? Not only might it be possible for you to buy that stock for less, but what if someone were willing to pay you cash today at a double-digit return rate and also give you the opportunity to buy it at a lower price later? Does that sound too good to be true? It’s not. It’s called "put option writing," and it’s available to you on literally thousands of stocks and Exchange Traded Funds (ETFs). Put option writing can be compared with placing a limit order to buy the stock or ETF of your choice at a lower price that you set…and then being paid for it. And, you get paid whether the stock falls to your price or not!
"Put Option Writing Demystified" is totally focused on providing (1) the education you need to fully understand the concepts behind put option writing and (2) a unique easy-to-follow program so that you can implement the strategy yourself without the help of a full-service broker or investment manager.
The book delves deeply into the subject of how to obtain double-digit returns from both out-of-the-money puts and in-the-money puts, with out-of-the money puts being the principal recommended strategy both for realizing the opportunity to achieve consistent double-digit investment returns while you wait to acquire stocks or ETFs of your choice at a discount to their present market value. It also provides short-term technical analysis tools to assist in guiding market forecasts and making even more profitable put writing decisions.
On May 3, 2003 after the annual meeting of his company, Warren Buffett (Chairman of Berkshire Hathaway) said to Maria Bartiromo of CNBC: "If you own equities, over the next twenty or thirty years you’ll get a reasonable return…maybe its 6%, maybe its 7%. People who expect 15% a year are doomed to disappointment."
If you believe that "The Oracle of Omaha" is right about a slow-growth market for decades to come, then everything that you need as an investor is here for you in this book to develop and implement a put option writing program that will help you achieve double-digit returns.
In addition to presenting everything you need to know about put option writing and how to implement your own personal put writing program the book provides:
* Use of a uniquely designed Microsoft® Excel spreadsheet for put writing to assist in reviewing writing selection alternatives so that the best decisions for you are reached to achieve your investment return goal.
* Details about brokerage accounts, with special emphasis on the use of online discount brokerages for quick, very low cost execution of trades. Web sites for brokerages, charting sources and other technical information are provided.
* Tax information you need for understanding and administering the income tax aspects of put option writing. This includes the opportunity for deferring taxation of income until a later tax year while enjoying the use of the income now.
How will the baby boomers be able to generate sufficient income on their investments to enjoy a secure retirement? And how will they and others younger than them be able to create a sufficient asset base to provide for their financial security with the dire predictions for the long-term future that we cannot expect markets to perform anywhere near as well as they have in the past?
With interest rates so low and a scarcity of acceptable investment alternatives available to investors, put option writing, as well as covered call writing, may offer two of the best possible opportunities to achieve consistent double-digit investment returns in the slow-growth market we seem sure to encounter ahead.
Average Customer Review:
7 of 9 people found the following review helpful:
Misled, 2005-07-30
The title for this book is patently misleading. Introduction to put options would be more apprpriate; nothing is 'demystified'; granting different levels of experience in options trading if you know the difference between a put and a call save your money. As is the usual with these types of books half to two thirds of the book is devoted to explaining options.
2 of 6 people found the following review helpful:
Good Information /Book itself is poor quality, 2005-07-28
I ordered the book new, I found the data useful and assisted my in proving a point that i needed to prove. Highlighting and tabbing book caused ink to distort to the point of making the pages blank. Ink just falls off page. I expected better for the cost....
2 of 12 people found the following review helpful:
Great Book, 2004-03-03
Dear Author!Just bought two books from Amazon, Put option writing and covered call writing. Thanks, your books are very useful, I will recommend to some of my friends about these wonderful books
Thanks again,
Readers
Kenny
20 of 22 people found the following review helpful:
A TRULY AMAZING INVESTMENT IDEA!, 2003-09-19
I would highly recommend this book to any stock investor who is looking for some new ideas to earn back the money they've lost in the bear market. Who ever heard of being paid immediate cash to wait to buy stocks at a lower price? That's what this book taught me to how to do. It sounds too good to be true, but I know it works because I've done it after reading the book. I wanted to buy the Nasdaq 100 Trust (QQQ) at a lower price. Instead of just waiting to see if it went lower, I wrote put contracts on the QQQ at my buy price using what I learned in the book. I collected $485 in cash in my brokerage account the next day. The stock didn't hit my price, so I didn't buy it the first month, but I got to keep the $485, which was a 24% return on an annual basis. The next month I did the same thing (collected $625 this time). My price was hit and I bought the QQQ shares for 15% less than the price when I started this. In the meantime I collected $1,110 while I waited to buy my shares for 15% less. This is explained so well that anyone can do it. Nobody I know seems to know about this. It's all in this book.