What is the F&O

M

mkboss24

New Member
#2
#2
[email protected] said:
I want to know abt the future and option. I just know its name nothing else abt it.
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in the Future & Option (F&O) v can trade with our pridections as the market would move upword n downword just like shortsell & buy tradind trand.its all abt the index or index shares future price value trade.

thanx
 
findvikas

findvikas

Well-Known Member
#4
#4
rati123 said:
However both are very risky but option is more risky than future.
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I completely disagree that they are risky unless you know the risk and evaluate them to profit from them. Trading itself is risky yet very lucrative & profitable.

The risk is not knowing the unknown. The risk is ignorance. The risk is not having complete knowledge and trading based on what others says and not knowing why you traded, what is your SL and what is your target.

Nothing personal, just trying to explain that Options are considered risky while they are not as risky as they may sound. They allow you to leverage, but you need to understand that leverage is two sided sword and holding it naked can be deadly. As long as you are holding it from right place and its hedged (in the cover) it acts like a self defence tool and could be very powerful in bringing you alive out of trade (war).... :)
 
R

rkkarnani

Well-Known Member
#8
#8
rati123 said:
A derivative, as the name suggests, is a financial instrument whose value is derived from another asset (known as the underlying). The underlying can be a stock, a commodity, and a market index among other things. The two main types of derivatives are options and futures.

Option:- An option gives you the right to buy or sell the underlying asset but not any obligation. There are two types of option:
1.) Call (Bullish towards the market)
2.) Put (Bearish towards the market)
These are further classified into two categories.

CA = Call American CE = Call European
PA = Put American PE = Put European

Future:- A futures contract is a standardised, tradable contract, which requires the delivery of the underlying asset (commodity, stock etc.) at a specified price and specified future date.

However both are very risky but option is more risky than future.

:rofl::rofl:
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There is a saying in Hindi : Neem hakim khatraye jaan!!!
(A doctor with half knowledge is dangerous for your life!!!)
 
columbus

columbus

Well-Known Member
#10
#10
rati123 said:
A derivative, as the name suggests, is a financial instrument whose value is derived from another asset (known as the underlying). The underlying can be a stock, a commodity, and a market index among other things. The two main types of derivatives are options and futures.

Option:- An option gives you the right to buy or sell the underlying asset but not any obligation. There are two types of option:
1.) Call (Bullish towards the market)
2.) Put (Bearish towards the market)
These are further classified into two categories.

CA = Call American CE = Call European
PA = Put American PE = Put European

Future:- A futures contract is a standardised, tradable contract, which requires the delivery of the underlying asset (commodity, stock etc.) at a specified price and specified future date.

However both are very risky but option is more risky than future.
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Rati,

Futures are instruments with unlimited loss with unlimited gain;
Options are instruments with limited loss with unlimited gain.
I think Futures are riskier than Options.
 
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