need advice in trading in F&O

[Agilent]

hi,
u need atleast 30k to trade on the futures. Options u can enter but it is risky if u dont understand it properly . So buy some good book on options .
there is a book on trading derivatives from ashwini gujral the guy who makes those predictions in cnbc. Or just google it there are plenty of free tutorials available onle

Give the guy a break !

He has lost money in cash markets... so, now he is on the back foot...

The last thing we should do is to encourage him to do even 'riskier' deals.

In tennis, when you fault on your first serve, you go easy on the second one ... and serve slower ... after all, you won't get a third chance.

Sachin ... are u there ?

AGILENT

 

[sivavkm]

Dear Agilent,
I have done Cash trading but was not sucessful but my investment in MF are standing good at this point. Now I have the liquidity of 10K which i want to use to recover my losses in equity.
Well i heared that one can earn high returns in FNO with min. investment and that had brought me here.I am aware it is very risky and thats why i want the help from you all guys.
regards,
Sachin

Hi Sachin, a must read :- Anatomy of my downfall

All the best
Siva

 

[kkseal]

By the way one small query

In our Indian mkts can you square-off (exercise) an option any time before expiry or ONLY ON expiry date?

Is there any difference in this regard between an Index & a Stock option??

Thanks,
kalyan

 

[beginner_av]

thx sivakm for ur link...
well kkseal....
http://www.sharekhan.com/SSKICMT/Upload/Drv_Upload/DerivativesDigest.pdf
http://content.icicidirect.com/derivatives/derivatives.asp

well for all ur options needs www.888options.com (not indian)

everything is in this forum...if i am not mistaken u have to dig a lot thru coal mines to get a diamond....any miners here?

 

[Agilent]

By the way one small query

In our Indian mkts can you square-off (exercise) an option any time before expiry or ONLY ON expiry date?

Is there any difference in this regard between an Index & a Stock option??

Thanks,
kalyan

KKS
In India , stock options are 'American' style (ie can be exercised any time) .... at one time they were European I believe

Index options (according to ICICI Dir Open Univ) are 'European', but I'm not sure ... I have squared off several times before expiry

Vince / Ivan .... come in here pl
AGILENT

 

[ivanboesky]

Firstly, there is a difference between exercise and squaring-off.
Exercise is when you exit your position by using the right you had purchased. If there is no offer price for an option in the market, you can 'exercise' your option to exit your position. This happens at the difference between the strike and the closing stock price.
You would square-off your position only when there is an offer in the market.
In India, stock options are 'American'. ie. apart from squaring off, you can also exercise your option.
Index options are 'European'. ie. you can only square off your positions, you cannot exercise them.

 

[aca_trader]

Both the European & American Options can be exercised. The only difference is that an american option can be exercised anytime before or upto expiry while an European option can be exercised only on the date of expiry.

On exercise, if the options are cash-settled (as is the case in India for both Index & Stock options), the net amount is debited/credited to speculator's account while if they are delivery-settled, stock is dellivered to/by the speculator. In more advanced financial markets, stock options are delivery-settled while index options are cash-settled.

Both the American & European options can be squared-off anytime before the expiry of contract where square-off would mean reversing the contract earlier entered into.

Best Regards,
--Ashish

 

[Agilent]

Thanks Ivan/ Ashish

There's always something to learn from this forum

AGILENT

 

[kkseal]

Dear Ashish, Ivan

Thanks for your explanations; but unfortunately the difference between 'excercise' & 'square off' is still not clear to me. Blame my ignorance for it.

Could you please cite a small example for illustrating the difference.

Also is there a chance of suffering a loss due to market mechanisms even if my initial call is correct? Like say i buy index Put options expecting markets to go down & markets do go down Still can i suffer a loss due to no offer price in the mkt etc.??

Sorry for taxing your valuable time.

Thanks,
Kalyan.

 

[kkseal]

thx sivakm for ur link...
well kkseal....
http://www.sharekhan.com/SSKICMT/Upload/Drv_Upload/DerivativesDigest.pdf
http://content.icicidirect.com/derivatives/derivatives.asp

well for all ur options needs www.888options.com (not indian)

everything is in this forum...if i am not mistaken u have to dig a lot thru coal mines to get a diamond....any miners here?

Thanks for the links b_av.

In fact i have already found quite a few diamonds in this forum (the most precious being the very helpful & co-operative attitude of the members). Wish had more time to dig.

Regards,
Kalyan.