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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Patrick Slevin who wrote (9328)	5/6/2008 6:53:43 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

Speaking of Spreads --- I own several of the older books and they are junky old model T's compared to Keith Schap's Masterful, beautifully written and well documented book, The complete Guide to Spread Trading. It has spreadsheet type lay outs charts. It outlines the mechanics of spread trading and covers over 25 specific spread trades in detail. He outlines different ways to look at price volatility and especially implied volatility. He gives the really classic advice that you should not be trading options if you do not have a specific forecast on which direction implied volatility is going to go in addition to in which direction you believe prices will move. In fact it is dangerous to ever talk to anyone about options, if they don't have a pretty good idea of what the implied volatility is and what it's range has been the past 3, 6 and 9 months. he does a great job of dissecting the crack spread trade. (cracking or refining Crude into Gasoline and Heating Oil). He also spends a lot of time on the treasury, note and bill markets and gives you more of a feel for many of the dynamics that are involved in adjustments to the yield curve that both the FED and the market create. John