Best Options Trading Books For Beginners

Updated June 15, 2024

Many people see options trading as a complex field that requires one to have sufficient practical and theoretical skills to navigate. This is quite true from an experienced trader's point of view. In case you are planning to venture into options as a means of diversifying your investments portfolio, then you must learn about its ins and outs. Reading options trading books is an important way to increase your knowledge base and boost your chances of getting more profits. 

This list, comprehensively covers the best options trading books to help you learn more about options. We further discuss each book's key takeaways, author, year of publication, and valuable insights they give to help you become a better options trader.

#1

Trading Options Greeks

"Trading Options Greeks" by Dan Passarelli provides an analysis of options pricing and risk management by focusing on the Greeks—delta, gamma, vega, theta, and rho.

#2

Trading Options for Dummies

"Trading Options For Dummies" by Joe Duarte offers a straightforward and accessible guide to understanding and trading options, covering essential concepts, strategies, and risk management techniques.

#3

Options as a Strategic Investment

"Options as a Strategic Investment" delves into various options trading strategies, providing comprehensive insights into how options can be used to hedge, speculate, and enhance portfolio performance.

#4

The Options Trader's Hedge Fund

"The Options Trader's Hedge Fund" offers a guide on how to run a profitable options trading business, focusing on strategies, risk management, and the operational aspects of managing a private hedge fund.

#5

Option Volatility and Pricing

"Option Volatility and Pricing" is a definitive guide to understanding and applying the principles of options trading, with a strong focus on volatility, pricing models, and risk management strategies.

#6

The Options Playbook

"The Options Playbook" by Brian Overby serves as a comprehensive guide for options trading, breaking down complex strategies into easy-to-understand plays for both novice and experienced traders.

#7

Fundamentals of Futures & Options Markets

"Fundamentals of Futures & Options Markets" by John C. Hull offers a clear and comprehensive introduction to the concepts and mechanics of futures and options, making complex financial topics accessible.

#8

Options Trading Crash Course

"Options Trading Crash Course" provides a concise and beginner-friendly guide to understanding the basics of options trading, covering essential concepts, strategies, and risk management techniques.

#9

Understanding Options

"Understanding Options" offers a clear and practical introduction to options trading, making complex concepts accessible to beginners while providing useful strategies for managing risk and maximizing profits.

Top 9 Books On Options Trading in 2024

In brief, the following are the books that made it to our list:

1. Trading Options Greeks


Dan Passarelli, the author of this book, gives solid advice on how you can use pricing, volatility, and time to drive profits in trades. The book has 368 pages, and was published in 2012. It has been one of the best go-to books for individuals interested in getting a comprehensive understanding of options trading and risk management.

Passarelli is a popular options trader with over 20 years of experience. He uses real-world scenarios and practical examples to help you make informed decisions. The book unravels the Greek's options concept and how to apply it to your trading strategies or find promising trades to gain profits. Besides, he uses charts and graphs to explain how you can understand the concepts.

That's not all; the book also guides you on trading dynamics, synthetic options, investment through spreads, advanced options trading, and put-call parity. Lastly, the book explains how you can use pricing accuracy to determine an investment's future projection.

2. Trading Options for Dummies


If you are new to options trading, then this is the best book for learning the strategies and basic rules. The 3rd edition of this book was published in 2017 and comprises 408 pages. The author, Joe Duarte, is a renowned financial writer and an active private investor who uses his experience in trading to give valuable insights to new options traders on how they can become successful.

Experienced traders are not left out, as they can also gain more information on how to use options like ETFs, indexes, and equities to gain more profits. In conclusion, the book covers trading in options basics, risk management techniques, and ways of capitalizing on sideway movements. Another aspect is how to take advantage of technical analysis to make viable trading strategies.

3. Options as a Strategic Investment


This book by Lawrence G. McMillan, a proprietary trader and writer contains significant information on how you can improve your options earnings while minimizing risks. Its 5th edition was published in 2012, and has 1072 pages. McMillan explains the different strategies you can incorporate with options like spreads, strangles, straddles, buying calls and puts, etc. 

He further explains why you should understand each strategy's risk/reward profiles and how to use them to leverage a current stock position. Moreover, he gives live examples of how you can use the price changes on options to your advantage. Risk management techniques like using stop-loss orders and shifting position sizes are also discussed. 

McMillan also explains why you should have a balanced approach to options trading and importance of exercising utmost discipline. Finally, the author also talks about psychological aspects like emotions and how they can impact your decision-making process.

4. The Options Trader's Hedge Fund


This book was co-authored by Dennis A. Chen, a hedge fund manager, and Mark Sebastian, an expert options trading coach. It was published in 2017 and has 240 pages giving detailed information on how you can manage your options hedge fund or trades. The authors use simple language from start to the end, making it easy for new traders to comprehend the concepts.

The authors' practical examples in options trading and hedge funds give you a big picture of real-world lessons. This gives you more confidence to try some of the concepts. Finally, the authors advise you on using the fundamental mental business model and the basic framework to optimize your trading strategy to get consistent profits.

5. Option Volatility and Pricing


This Option Volatility and Pricing trading book was authored by Sheldon Natenber, a professional trader and writer. Its 2nd edition was published in 2014 with a total of 592 pages. Various topics are covered including dynamic hedging, volatility, foundations of the options theory, risk analysis, directional trading strategies, and position management.

Sheldon is highly concerned with updating you on the latest trends in trading and options, this is openly  shown in his 2nd edition. The book is written in a simple and easily understandable language to suit traders of different levels. Sheldon also explains the basics of the options theory and how to apply it in making or exploiting trading opportunities. 

The book also adds up as a guide to various advanced trading techniques and strategies. Moreover, it gives tips on how to select a trading strategy based on your risk tolerance and personal view of financial market conditions.

6. The Options Playbook


The options playbook is authored by Brian Overby, a distinguished options trading professional. It's written in a simplified manner to satisfy the needs of both beginner and experienced traders. The book's 2nd edition was published in 2009 and contains 295 pages. It covers different topics and basic definitions of trading terms to help you understand the market. 

This updated version has over 40 options trading strategies thus gives beginner traders a variety of choices and confidence to enter the market. The book gives valuable insights on the timely execution of trades, break even points at expiration, and understanding the effect of volatility in market prices. 

Moreover, you'll learn how to handle risks by quickly recovering from mistakes or unexpected market conditions. Lastly, you'll understand how market dynamics can affect the price of options.

7. Fundamentals of Futures and Options Markets


John C. Hull, a highly reputable risk management and futures expert, is the author of this bestselling book. He advises you on the best strategies to estimate the value of options over time and gives practical information on interest-rate currencies, futures, or swaps. This book has been updated severally; its 7th edition was published in 2011, comprising 624 pages. 

This reader-friendly book uses practical, real-life accounts and numerical examples without using complex jargon to guide you from the beginning to the end. This helps you to understand the given concepts quickly and adapt them to jumpstart your options or future trading journey.

8. Options Trading Crash Course


If you are a beginner in options; this book by Frank Richmond, a famous economist and trader gives you a step-by-step guidance. It explains all the complex options jargon in a simple language and unlocks for you new opportunities to make profits. This Options Trading Crash Course book has 112 pages, and was published in 2020.

This book contains various fundamental options trading concepts to help you get an inner understanding of the market. It additionally covers other essential aspects, like how to spot market patterns and investments with promising potential. The book also explores different strategies you can employ to make the best out of your investment capital.

9. Understanding Options


Understanding Options is a bestselling trading book by Michael Sincere, a reputable author of multiple investment and trading books. Its 2nd edition, comprising 322 pages, was published in 2014. In this book, you will get insights into the nature of options, their relationship with stocks, pros/cons, and how to use them to earn extra income. The book has a bunch of features, including charts, facts, figures, and credit/debit spreads. 

Sincere starts by explaining the basics of options trading and goes deeper into the fundamentals. Next is the section on understanding options strategies, where he discusses concepts like covered calls, risk management, and advanced trading strategies. Here, he also explains how volatility in financial markets can affect the price of options.

Additionally, Sincere comprehensively explains the practical aspects you can apply to options trading. He offers guidance on the importance of carrying out in-depth research, types of orders, and selection of options brokers. In conclusion, this book is a detailed guide to options, risk management techniques, and trading strategies.

Why Read Options Trading Books?

Expert traders with big earnings from stocks, options, or currencies, don't enter into trading blindly. They know their crafts well and know which trades to choose. Reading options trading books helps boost your trading psychology and learn from experienced traders or financial advisors.

Conclusion

The above 9 best options trading books can help boost your interest in options and trading in general. But it isn't all about reading the books; you should show dedication and enthusiasm to learn the provided insights or practical examples to succeed.

These books cover different topics like pricing, volatility, risk management, or developing personalized trading strategies. This makes them great masterpieces for beginners and professional traders.

Jerry Garnes

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About the Author

Jerry Garnes is a seasoned writer in personal finance. His informative and insightful pieces have been featured by esteemed platforms like Bankrate, The Street, and Business Insider. In addition to his financial expertise, Jerry is a passionate poet and musician with a deep love for nature.

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