List of Derivatives Articles

The financial lives of every individual has become complex as there are multiple incomes and a number of expenses. Such scenario calls for the need to keep the finances in order so as to avoid challenges in future. Every individual has a unique set of financial goals and challenges, which needs customized personal financial planning.

Options are not only liquid but they are many times larger than the cash market and the futures market in terms of daily volumes.

The difference between underlying securities current spot price and strike price represents the profit/loss that the trader makes upon sale or exercise of the option.

The essential difference between call option and put option arises from the fact that one is an option to buy an underlying asset and the other an option to sell the asset.

Investing is one of the best ways to utilise your disposable income. However, it is always best to go with investment tools that offer high security and guaranteed returns when you first start investing.

In the stock markets, pricing of any asset class is based on expectations. For example, the future price is the expected spot price and the spot price is nothing by the present value of the expected spot price.

Investors are comfortable with the trading techniques they know will help them diversify. Once they know they have achieved their profit goals from equities, they move to other asset classes that have the potential to offer significant profits.

Derivative trading is one of the most rewarding asset classes for investors who have allocated some capital into equities. Professional investors choose Options contracts within derivatives to ensure they remain liquid and make profits in almost every market situation.

A short call is an options trading strategy for bearish traders. Essentially, short call traders are bet on a share price fall and benefits from a fall in prices.

A vertical spread also called a credit spread, involves buying and selling Options of the same class (Call or Put) but different strike prices. Vertical spreads can be bullish or bearish

A Short Straddle is a complex Options strategy that consists of selling both a Call option and a Put option, with the same strike price and expiration date.

When investing in the Indian financial market, one thing to be certain: Risk. Market risk is the most common and universal within every asset class in the financial market.

A Long Call Condor, similar to a long butterfly strategy, is a neutral market-view strategy that offers limited risk and profit.

There are numerous professional investors that earn almost all of their profits from Options trading.

Professional investors understand every factor that can affect the Indian financial market.