| The introduction of futures and options trading has changed the face of Indian stock markets with investors having access to a new market where they can hedge their investments in certain stocks , have limited risk positions which give higher returns in percentage terms and can leverage their positions by paying a margin towards the purchase of the stocks they have bought.
Futures contracts expire monthly on the last Thursday of every month and have minimum lot sizes for the stocks that can be traded. Currently there is a limited list of stocks available in the futures and options market (SEE LIST). We specialize in advising clients on strategies in this market and one of our traders will be happy to advise clients on a strategy with best suits the clients need.
For example if you are bullish on a stock and have a price target for a month rather then buy the underlying stock in the cash market you can buy an option which is a limited risk investment. If the markets crash the maximum you can lose is what you have paid for the option. If you owned the underlying stock your loss could be much more. Also if one is bullish or bearish on the market as a whole, rather than pick individual stocks one can buy or sell the NSE Index (NIFTY) for a small margin payment and hold the position for a month at a time with the option of exiting at any time up to the expiry.
There are many strategies and our derivatives section will give you more information. Clients can always call us for advisory services.
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