Derivative trading

zse9 · #11 20th January 2007, 08:33 AM

Not to sound too elitist, but personally I think that just like every other field market participants should take baby steps and start trading in advanced F&O segment only once they have enough experience in the stock market.

Once they have enough trading experience in trading in stock market if they were successful they should have more than enough money to invest in F&O segment. If they have not made enough money ion the stock market that have not gained enough knowledge nor money to trade in the F&O segment.

I have seen some brokers recommend people who have lost money in the stock market to invest whatever little is left in Futures, because they don't have enough money in invest in stocks. (As per the brokers the margin requirement is less than in stock market and profit potential is much higher, which is really true. What they miss to convince the investor is that loss potential is much higher too. If they were not able to make money in the stock market it is very highly probable that they may not be able to make money in the F&O segment either.)

So again - baby steps. Make money from the stock market before you invest in much more riskier F&O segment.

vince · #12 20th January 2007, 10:56 AM

Quote:

Originally Posted by sunil saranjame

NSE should now introduce something like the S&P 5OO emini futures in the U.S., the lot size will be smaller and will attract many people. I am not sure when the 'babus' in NSE will understand all this... anyway let us hope!

Sunil Saranjame.

Sure would be a good way to increase volume and retail participation. In fact smaller lots for stocks would also make the options market more liquid.

Don,t know when the mamu's at NSE will wake up.

beginner_av · #13 20th January 2007, 06:14 PM

they are protecting the small investor...

vince · #14 21st January 2007, 07:52 AM

Quote:

Originally Posted by beginner_av

they are protecting the small investor...

From what ? Making money ?

We do have small traders who are very very savvy in the fno market.

Besides options are also a great way to hedge your cash holdings.

kulusayali · #15 21st January 2007, 08:57 PM

Quote:

Originally Posted by alpha1

Hi folks.

Am absolutely new to derivateives trading, and wish to know about how it is done, what things to look out for etc.

Basically everything that a person should know before trading in them.
As of now I have had experience only in equity trading.
Please help

hi
i want to go for Technical Analysis course conducted by BSE/NSE
can u pl provide me some info @ it?

Linus · #16 21st January 2007, 09:20 PM

Hi Kulusayali, Check out http://bseindia.com/training/about.asp

On the lighter side, I have heard about Kulu Manali !!

ATB, and best regards,

sunil saranjame.

qrius2noall · #17 21st January 2007, 11:29 PM

WHEN WILL THE BABUS OF NSE WAKE UP?
interesting comment,although difficult to answer

I don't know why they dont look around and see what all is happening around in the rest of the markets of the world-newer better products,use of ever expanding technological base,ever increasing market share,making trading more customer friendly and to attract wider participation of masses....

Is there any sense of keeping market lot of FUTURE OF SBIOF 500 SHARES THATS ALMOST 3 TIMES THE INTENDED LOT SIZE OF ABOUT 2 LAKHS -the result- common individual investor is deprived of a chance to participate and this is true for so many other scrips

to talk about the depth and breath of options market( especially of stock options) -the less said the better-except a few active counters,the rest are seeing just nominal activity-while in real active markets
this segment should draw the maximum volume

and to put an end to this post,look at their funny order about brokerage charges for options contracts-2.5% or Rs. 100trying to please all-the brokers as well as the traders- without achiecving any benefit for anybody,rather making it more complicated without explaining-what about STT charges-whether chargable on the premium amount or on contract value?

The only ray of hope comes from the fact that since FOREIGN STOCK EXCHANGES ARE TAKING STAKE,MAYBE THEY CAN INJECT SOME SENSE AND INNOVATION IN THE WORKING OF THESE BABUS OF NSE

neo · #18 23rd January 2007, 02:39 AM

Guys,
It is easy to understand, why these babu/mamus of NSE are not trying to have smaller lots for F&O. The Only reason is "Fear Factor".

The bigger the lot size (in terms of money), More fear it will generate. The Big Boys can generate sharp price movements to generate more fear in small investors.

If the price movement is in favor of small investor, Greed make sure that he does not liquidate his position, If price movement is in reverse direction, Hope will make sure that small investor does not liquidate his position too early and FEAR will make sure that ultimately he liquidates his position incurring Large losses. This is how the F&O market is constructed.

I wrote NSE about introducing smaller lots for F&O, However they does not seems to even reply. The best way to play F&O market is to go for Reliance Money, and then tread in Nifty/RIL/TISCO options, which are the most liquidated options available. Reliance money will take care that you pay around 120Rs for 1 buy-sell transaction and liquidity in these script will make sure that you get good returns.

Meanwhile forget the myth that NSE-BSE are there for general public, They are there to look after interest of Big Boys.

vince · #19 23rd January 2007, 09:43 AM

"Meanwhile forget the myth that NSE-BSE are there for general public, They are there to look after interest of Big Boys."

Maybe Neo, but what are the regulators doing, aside from making people run around to apply for moronic cards and numbers.

alpha1 · #20 23rd January 2007, 11:43 AM

Anyone seen Guru?

This NSE/BSE seems just like the market whcih "Guru" initially enters.
And he realises that each and every stop and check + procedures has been put by well established large players to ensure that no one new gets into the system and suceeds.

LOL

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