Day Trading Stocks & Futures
- Thread starter TraderRavi
- Start date
- Tags banknifty bnf daytrading nifty future
re: Day trading Nifty & Banknifty Futures
Hi Nagathilak
Options offer far more ways to trade with compare to a future contract. I think you already recognized parts of that fact when I read your post. The possible profit with an option compared to the investment we some times make could be and is some times in levels of 100 of %. But that are not normal situations and happen more rarely, if not seldom. And this specially when it comes to let profits run or choosing to close the trade.
A future on the other hand is what it is. You buy it, you sell it. If you trade a future contract you do not, or less consider, what you can do with it in terms of strategies. It is a direct play and less a strategical game, even it is a strategy game when it comes to adding contracts in an ongoing trade. MM and stop losses have an other impact in future contract trading compare to option trading, as you for example less add options in a strategical game compare to adding futures in a moving market. Here probably one of the conflict starts between option trading and future trading.
If I buy an option at a certain price, that is all what I can lose. If I buy a future at a certain level, I can loose huge amounts of money, when not having a stop loss. So that is an other point which differs options from futures.
Options are in my mindset and trading used mainly strategically to reduce risk for further investments, how ever they are done. I think, most people burn there fingers with options because they use them the wrong way. And that specially when it comes to naked option speculation. But that is the way I value it and nothing else. Just my personal opinion about that specific point.
Take care / DanPickUp
Hi Nagathilak
Options offer far more ways to trade with compare to a future contract. I think you already recognized parts of that fact when I read your post. The possible profit with an option compared to the investment we some times make could be and is some times in levels of 100 of %. But that are not normal situations and happen more rarely, if not seldom. And this specially when it comes to let profits run or choosing to close the trade.
A future on the other hand is what it is. You buy it, you sell it. If you trade a future contract you do not, or less consider, what you can do with it in terms of strategies. It is a direct play and less a strategical game, even it is a strategy game when it comes to adding contracts in an ongoing trade. MM and stop losses have an other impact in future contract trading compare to option trading, as you for example less add options in a strategical game compare to adding futures in a moving market. Here probably one of the conflict starts between option trading and future trading.
If I buy an option at a certain price, that is all what I can lose. If I buy a future at a certain level, I can loose huge amounts of money, when not having a stop loss. So that is an other point which differs options from futures.
Options are in my mindset and trading used mainly strategically to reduce risk for further investments, how ever they are done. I think, most people burn there fingers with options because they use them the wrong way. And that specially when it comes to naked option speculation. But that is the way I value it and nothing else. Just my personal opinion about that specific point.
Take care / DanPickUp
:annoyed:
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