Futures and Options are financial derivatives that derive their value from an underlying asset, offering ways to speculate or hedge against price movements.
Futures and Options
Futures and Options (F&O) are financial derivatives that derive their value from an underlying asset like stocks, commodities, or indices.
Futures and Options
Common Question about Futures and Options
-
1. What are Futures and Options (F&O)?
-
2. How do Futures and Options trading work?
Futures involve buying or selling contracts for future delivery, with prices agreed upon now. Options provide flexibility for the buyer to exercise based on market conditions.
-
3. What is the difference between Futures and Options?
Futures obligate both parties to fulfill the contract terms at expiration, while Options give the buyer the right, but not the obligation, to buy or sell the underlying asset.
-
4. What are the main benefits of trading Futures and Options?
Benefits include hedging against market volatility, leveraging investments with lower upfront costs, and diversifying portfolios with different strategies.
-
5. Who Should Invest in Futures and Options?
Investors looking to manage risk exposure, hedge against price fluctuations, or capitalize on market opportunities may find F&O suitable.