Options Trading Books – Recommended Reading

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Market Wizards: Interviews with Top Traders by Jack D Schwager

I believe that this is one of the top-selling trading books of all-time. It tells the story of how the world’s top traders make millions of dollars in the markets – sometimes in a matter of only weeks or even days. In this book the author, Jack Schwager, interviews 17 superstar money-makers including Richard Dennis, Paul Tudor Jones, Ed Seykota, Marty Schwartz, Tom Baldwin and others. After reading this best-selling book, you’ll know what ingredients enable these top traders to consistently work their financial magic in the markets while so many others walk away losers.

Traders, Guns and Money: Knowns and unknowns in the dazzling world of derivatives by
Satyajit Das

I also enjoyed Traders Guns & Money which is a funny and eye opening insight into the culture, games and pure deceptions played out every day in trading rooms around the world. And played out with other people’s money. I think this is a excellent insider’s view of the business of trading and marketing derivatives. This riveting bestseller reveals the truth about derivatives: those financial tools memorably described by Warren Buffett as ‘financial weapons of mass destruction’. Traders, Guns and Money will introduce you to the players and the practices and reveals how the real money is made and lost. I could hardly put this book down.

Liars Poker by Michael Lewis

Another brilliant read is Liars Poker. This book is highly entertaining and a thoroughly enjoyable read. Liar’s poker is a game played in on the side by workers on Wall Street, the objective of which is to reward trickery and deceit. We see the story told by Lewis of his four years with the Wall Street firm Salomon Brothers, from his bizarre hiring through the training program to his years as a successful bond trader. There are many strange and bizarre stories he tells from 1984 through the crash of October 1987.

The Bible of Options Strategies: The Definitive Guide for Practical Trading Strategies by Guy
Cohen

This bible will now always sit along side the regular bible in the bedside drawer. This book is a must for any serious trader’s library. Options trader Guy Cohen has captured the beauty of options as a flexible trading vehicle with this book.

He reduces more than 60 options strategies strategy into five key areas:

1. Income strategies
2. Volatility strategies
3. Sideways market strategies
4. Leveraged strategies
5. Synthetic strategies.

Even the newest trader will find his insightful explanations of the most complex strategies clear and concise.

Reminiscences of a Stock Operator by Edwin Lefevre

I like this book as it’s a fast paced, well written and very interesting read. This book continues to be one of the most useful and most-loved book ever written on the subject of trading and speculation even though it was written in the 1920’s. It tells of the life and times of the book’s protagonist, Larry Livingston, a pseudonym for Jesse Livermore, one of history’s most famous traders. Some of his rules to live by that I like are:

-The trend is your friend.
-History repeats itself.
-No stock is too high to buy or too low to sell.
-Let your winners run and cut your losses quickly

This book is true to the real wall street and a must for anyone’s book shelves.

24 Essential Lessons for Investment Success: Learn the Most Important Investment Techniques
from the Founder of Investor’s Business Daily by William j O’Neil

This is a good book for a beginner investor. In this book, the author offers 24 “essential lessons” which he has learned from his extensive prior experience. He offers additional insights into avoiding losses and using technical analysis to pick optimal stocks and times to buy and sell. It’s a short and easy to read book that I would recommend to anyone.

Options Made Easy by Guy Cohen

Possibly the best book available for options trading beginners as it provides great clarity on all the main options concepts and strategies. Visual tools are used throughout the book as a way for the new options trader to enhance their learning experience. Cohen will help you master practical strategies for profiting in any market environment.

Profiting With Iron Condor Option by Michael Blenklifa

When Genius Failed: The Rise and Fall of Long-Term Capital Management by Roger
Lowenstein

Rogue Trader by Nick Leeson

How Legendary Traders Made Millions: Profiting From the Investment Strategies of the Gretest Traders of All time by John Boik

Trade Your Way To Financial Freedom by Van K. Tharp

High Probability Trading by Marcel Link

Options as a Strategic Investment

Come Into My Trading Room by Alexander Elder

8 Comments
  1. Gav McMaster says:

    Thanks Jonathan, good call. I’ve added it above

  2. Jonathan says:

    For serious options traders, “Options as a Strategic Investment” by Larry McMillan is beyond mandatory. I’ve read it countless times.

    1. Other Jonathan says:

      I have read it many times cover to cover as well. I think there’s a lot of room to expand, but McMillan doesn’t seem very interested in updating the book anymore.

  3. Alan MacLean says:

    Just purchased ‘Dark Pools’ by Scott Patterson after reading the free trial. So far it’s got me captivated with a story about machine trading and how it affects the market. Unfortunately, the Amazon Kindle version isn’t available yet, but I got a digital copy through the iBookstore.
    I also enjoyed ‘Show Me Your Options!” by Steve Burns. He writes it as a story of a mentor and a student which makes it more interesting to read. There’s also an appendix with the probability strategies that I liked.
    Both books were published this year (2012)

  4. Johnsurdi says:

    “Selling Puts My Way” by Jerry Lee is a simple straight forward book that is available on Amazon. I use his simple strategies for very successful capital growth.  

  5. Dave Johnson says:

    Gav,
    Thanks for all your help. My recommendation for your reading list.
    Trading In The Zone
    By Mark Douglas

    1. Gavin says:

      yes that’s a great book alright.

  6. John Dowling says:

    “Options: The Plain and Simple Guide to Successful Strategies” by Lenny Jordon (Financial Times Guides) was an excellent read and kept by me for constant referencing

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