buy-stock

I picked this up ... at a book clearance sale, if you have to pay more pick another title. First of all the author says he sells puts (contracts agreeing to buy a stock or index at a set price until a specific date for which you receive a premium) to buy stocks in his investment account. There is not a single example in the book of a trade he executed this way. Instead he fills about 1/4 of the book with hypothetical computer runs assuming you had sold every LEAP contract over a multi year period. That is just a silly example for the individual investor. That is akin to comparing all of the insurance coverage written by Prudential with you writing a policy on your grandma.

Second he gives you numerous pages on how to calculate Volatility and Black-Scholes, etc. What is missed is that you want to be selling Puts and Calls when Volatility is High, and most option brokers do this calculation with a computer. As for Black-Sholes, the calculation is easy to find on the web, but any "advantage" that it may provide is used by insititutions who can rapidly scan the whole market and quickly correct any price imbalances. Unless you enjoy crunching financial formulas by hand, this section is filler at best.

Finally, his stock selection and risk control methods are questionable at best. Think Enron and realize that even "independent" reviewers like Morningstar and Value Line had it well rated up until the bitter end. If you dont already have a solid stock picking methodology, you should not start buy selling options. The notion that a reader should do anything other than sell an option that is 100% covered by CASH is the same as endorsing the methods that bankrupted many very large traders, banks and hedge-funds.

If you are looking for investment ideas Getting Started in Options may be a good place to START. Throw in Peter Lynch, Justin Mamis, and Andrew Tobias for good measure.

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.

I trade equity options. I have read a lot of books about options. Basically, once you have read McMillan's book, none of the other option books have anything to add. Except this book.
This book shows some original thinking; it's not just the same old thing about bull spreads, etc. The book advocates more than just selling puts to get premium or to use as a method of buying stock at a discount. He explains how you can sell puts on solid companies and buy stock of other companies with the premium you brought in. He really got me thinking, and I have gone from his ideas to developing some of my own.
This book is well worth reading. Read it to get ideas on how to use puts for your own advantage. Learn something new.

As an individual investor, I am always looking for resources that can maximize my investments. Mr. McCulla's book provides valuable information on the little known program of purchasing stock directly from companies. The book details a step by step guide for purchasing stocks directly and has a complete list of companies that sell stock in this manner. It is an excellent resource for all investors

Perhaps a sign of the hi-tech times, this book was published in 1996 and is now so dated it is of very limited value. If you read newspapers, or some financial magazines, I think you're already well past what is offered here. One facet of the book I actually found a little irritating is the tendency of the author to use copious amounts of filler between the tidbits of useful information.

There are tons of these books and this one is pretty good but "Gorilla Game: Investors Guide..." is better. I would recommend getting that book before you get this one.

The book doesn't give too much in the way of simple formulae, but does give a lot of insight that the reader can use to help develop an investment strategy re technology. Some of it is a little dated, but I would recommend reading the whole book, not just a couple of chapters.

The following (long-ish) quote from chapter 8 I regard as very profound and chapters 8 & 9 worth re-reading and ponderingh awhile: "I would avoid placing bets on any side in the compatibility wars. We have entered a period in computer technology ....... when monopolies and even profitable pricing are becoming more and more difficult to sustain....... The outcome, which is compatibility, is a foregone conclusion. favor the stocks of those companies - and they are not necessarily computer or networking companies - who recognise at the strategic level that the intersection of data and communictaions networks simultaneously creates a broad new market and a wholly new product. And that this product, which is a supernet, is coming into the world like an avalanche".

I regard this as a profound insight, and is precisely what is happening on the internet at this moment. Understanding chapters 8 & 9, and reviewing the markets in its light should help considerably in understanding the current craziness of the 'net and possibly in identifying the next winners.

The book isn't full of correct predictions and winners, but the basic insghts are still valid.

The main strength of this book is the 100 detailed company profiles, which give the rundown on the company's core businesses, their history of profitability, product and market area dominance, quality of management, and so on. What use is this, you might ask? Well, Peter Lynch once said that you should be able to tell at least a two-minute story about each stock you buy. Well, the coverage here amounts to a ten-minute story for each of the 100 stocks. Most of these were familiar to me, but some weren't, and so I learned something there. Perhaps the best stock I learned about was good ol' MMM, Minnesota Manufacturing and Mining. It has a 20-year record of 20 percent return on equity (ROE), and amazingly, 30 percent return on capital. You could do worse than buy this stock and just hold it. (By the way, it's up several points over the last few trading days in the market, and Proctor and Gamble has done pretty well also, another recommended stock). Anyway, for those wishing to follow a conservative, large-cap investment program, this book is packed with useful information. Anybody who buys the top dozen stocks in this book, distributing them among at least half a dozen sectors, should do pretty well over the long term. Remember, although 90 percent of all mutual fund managers don't beat the broad indexes, it's only necessary to match the market's performance over the long haul to become very well off financially and secure your retirement. This book will help you do that by concentrating on the fairly conservative strategy of buying and holding quality large-cap stocks.

John Slatter's strategies to some may be archaic, to others nonsensical. But really, when it comes to investing, everyone has their own strategy anyway, so what is the fuss all about? Slatter's statement about stocks is really in reference to the "bond craze" that some people get, the real estate markets and commodities. People who don't understand those particular markets should stay away from them as they have a good potential to get burned if they are ignorant about their moves within it. More people understand stocks, he knows that, so he is going to speak to these people. The definitions of market lingo are great and very clear. The company profiles are great and give pretty good insight into each company and what makes them valuable. Updated information? Why try and find that in a book anyway? The internet will do for updated information. Afterall, the author is only giving an opinion as to what makes those particular stocks valuable. He is definately not writing a stock atlas or performance history. Good read, thought through all the way.

After perusing about 30-40 books that deal with the topic, I purchased one book, The 100 Best Stocks You Can Buy in 2003. I am convinced I made the right choice. Mr. Slatter's book is excellent--insightful, readable, thorough--and full of useful bits of information the novice will overlook.