Futures and Options

Futures and options in share trading

Futures and options in share trading


European-Style Options : A European option is an option that can only be exercised at the end of its life, at its maturity. European options tend to sometimes trade at a discount to their comparable American option because American options allow investors more opportunities to exercise the contract.

Futures Contracts vs. Options—Which Are Better?

Futures contracts tend to be for large amounts of money. The obligation to sell or buy at a given price makes futures riskier by their nature.

The Basics of Futures Options

Short Dated New Crop Options : The term short-dated refers to a shorter window before the option's last trading day, otherwise known as option expiration. A traditional (or long-dated) option has a longer window before the option expires. In corn, traditional December calls and puts expire in late November. In soybeans, traditional November calls and puts expire in late October. Short-dated options have the same underlying futures contract (or instrument). The underlying futures contract for corn is December, and the underlying futures contract for soybeans is November. With short-dated, there are fewer days of coverage. As an example, a July short-dated option will expire in late June, even though the underlying futures contract is December.

Options on Futures - CME Group

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Know Difference Between Futures and Options | Angel Broking

A Future is a right and an obligation to buy or sell an underlying stock (or other assets) at a predetermined price and deliverable at a predetermined time. Options are a right without an obligation to buy or sell equity or index. A Call Option is a right to buy while a Put Option is a right to sell.

Options On Futures Definition

Interested in learning to trade options on futures? This is the place to start. Discover how options on futures can help you mitigate downside risk and diversify your portfolio. This curriculum covers the basics of option trading, strategies and hands on tools to increase your knowledge of options.

At CME Group, enjoy options trading across all the major asset classes on one global marketplace. Benefit from the deep liquidity of our benchmark options on futures across Interest Rates, Equity Index, Energy, Agriculture, Foreign Exchange and Metals, giving you the flexibility and market depth you need to manage risk and achieve your trading objectives. And, by trading options where you trade the underlying futures hedge, you can maximize capital efficiency through margin offsets and streamlined operations.

Let us look at futures first. Assume that you want to buy 6555 shares of Tata Motors at a price of . That will entail an investment of lakhs. Alternatively, you can also buy 6 lot (consisting of 6555 shares) of Tata Motors. The advantage is that when you buy futures, you only pay the margin which (let us say) is around 75% of the full value. That means your profits will be five-fold that of when you are invested in equities. But, the losses could also be five-fold and that is the risk of leveraged trades.

Get answers to frequently asked questions about options on Micro E-mini futures, including product details and margin information.


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