Practical Options Trading: Books on Strategy and Implementation
Summary
The discussion recommends books for readers who know the mathematical foundations of options but want more guidance on applying them in trading. It highlights Euan Sinclair’s Volatility Trading for its coverage of strategies, liquidity, and position sizing, and mentions his other forthcoming work as of the original answer. It also recommends Sheldon Natenberg’s Option Volatility and Pricing as an intuitive, practice-oriented companion to broader references.
Hull’s Options, Futures, and Other Derivatives is offered as a classic general reference, while one contributor argues that its wide scope makes it less useful as a detailed practical guide for any single topic. These are personal recommendations rather than a systematic comparison: the discussion gives no evaluation criteria, trading results, or assessment of newer editions. It is most useful as a starting list for further reading, with the distinction between broad academic coverage and practitioner-focused treatment as its main selection principle.
Key ideas
- Euan Sinclair’s Volatility Trading is recommended for practical strategy discussion.
- The recommended practitioner topics include liquidity and position sizing.
- Natenberg’s Option Volatility and Pricing is presented as an intuitive practical companion.
- Hull’s broad derivatives text is recommended as a general reference but criticized for limited depth on individual topics.
- The recommendations reflect contributors’ opinions rather than a measured comparison of books.
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Full text
# Books on options trading with a practical bent? # Books on options trading with a practical bent? just curious to see if anyone here has come across a book or books on options trading with the practitioner in mind? My lecture slides for instance, go through black scholes and the ins and outs of the derivation, ito’s lemma etc, but they are very light on how the BSM is actually used in practice (ie reality). Any ideas? ## Answer by Brian B (score 7, accepted) https://quant.stackexchange.com/a/53845 In my opinion there is one modern author on the subject of practical options trading who stands head and shoulders above the rest, and that is Euan Sinclair. His most recent book is Volatility Trading, and he has another book out soon. Sinclair covers actual strategies, along with questions of liquidity and position sizing that I never see in other options books. He writes clearly, and (though I have not evaluated its quality) includes source code. Though @Giovanni recommends Hull's classic, I find that text to be more of an academic encyclopedia than a practical guide. It is a great book but its scope is too broad to provide the detail you need. These days, I rarely look at Hull because for each subtopic, there is typically a more detailed book or article that serves as a more complete starting point. One other classic book, that contains a lot of the practical thinking you might want, is Nateberg's Option Volatility and Pricing. It has often been treated as a more intuitive and practical companion to Hull, with good reason. ## Answer by Giovanni Leone (score 0) https://quant.stackexchange.com/a/53033 I’d say Hull’s “Options, Futures and Other derivatives”, whatever edition is fine.
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