Tag: Future and Option Trading

Future and Option trading a type of trading tool. They make derivatives trading. Derivatives are trading instruments which are derived from an underlying security. That security can be index, stock, currency or commodity. So it can be stock futures trading, currency trading or commodity trading.
The reason for the popularity of Future and Option trading is the margin or cash leverage they offer to traders. They allow the traders to take big trading position by paying minimum required cash which otherwise would require big trading amount. You can take position in Futures trading by paying only 15-20% amount of the total trade value.

As with futures trading, options trading also offers cash leverage. You can create big trading position with small amount used in trading. This is called as Option Premium.
In fact, Options offer much higher leverage than futures. Although, risk is limited and profit potential is unlimited, you tend to loose money faster in options trading also.

To know more about this, you would need to learn how to trade options. Trading education is must before you jump into future and option trading.
Here you will learn how to start future and option trading to make money in the stock markets.

Intraday Trading Formulae and Rules

The intraday trading formulae are useful for finding your Target price and Stop loss in intraday trading. Apart from these formulae, Intraday trading requires to follow certain day trading rules, strict concentration, discipline, hold on your nerves and the last but not the least, the technical analysis to succeed. Intraday …

How To Trade Morning Star Pattern

Morning star pattern holds an important place in technical analysis. Morning star pattern is a reversal pattern and a bullish candlestick patterns. It forms after a sharp decline in stock prices or stock markets. Morning star is a term which indicates light after darkness. After the ‘darkness’ of price fall …

The Factors Affecting Option Prices (UPDATED)

Option Price involves two components – Intrinsic Value of Option and Option Premium. Option Premium is the value we get by subtracting the Intrinsic Value of Option from the Current Market Price of that particular Option. Only In-the-Money Options have Intrinsic Value (explained below). Time Value of Option and Uncertainty …

What Is Open Interest and How Does It Work?

Market Traders have to consider a lot of factors on which the price behavior of a security or stock depends, before entering a trade. They study technical charts, technical indicators, market trend and current sentiment in the markets. Learn About Technical Charts and Indicators Another factor which plays an important …

Get more stuff like this
in your inbox

Subscribe to our mailing list and get interesting stuff and updates to your email inbox.

Thank you for subscribing.

Something went wrong.