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Futures & Options

Futures & Options

Buying and selling derivative products (futures and options) is referred to as derivatives trading. The goal is to use nominal margins to hedge portfolio risks and create significant gains from price volatility. Derivatives are financial instruments that derive their value from underlying assets such as stocks, bonds, currencies, and commodities. You'll need a F&O account to trade derivatives.

What is Futures & Options?

Buying and selling derivative products (futures and options) is referred to as derivatives trading. The goal is to use nominal margins to hedge portfolio risks and create significant gains from price volatility. Derivatives are financial instruments that derive their value from underlying assets such as stocks, bonds, currencies, and commodities. You'll need a F&O account to trade derivatives.

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You’re all set. Start trading

You’re all set. Start trading

About Futures & Options

Within the equity market, there is another segment which is called the derivatives market. Futures and Options (F&O) are the most common derivative contracts where two parties enter into a contract. It is speculative in nature and considered a safer option than the share market.

The basic difference between Futures & Options

  • A future contract requires a buyer to purchase shares and a seller to sell shares on a specified future date
  • Option contract gives the buyer and seller the right, but not the obligation to sell or purchase
  • So, if needed, you can opt out of your options any given time

FTD bonus- 5% of total deposit can be availed upon FTD

 

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Learn more about stocks

What is Equity trading?

Traders can trade stocks on the equity market. Public and private stocks are available to investors. Unlike private stocks, which are traded privately, public stocks are traded on exchanges. When a company is formed, it is initially private before launching an IPO.

What is a dividend?

A dividend is a payment made by a corporation to its stockholders, usually out of its profits. Dividends are typically paid regularly (e.g., quarterly) and made as a fixed amount per share of stock—the more shares you own, the larger the total dividend payment you’ll receive.

What is Income Tax?

Income tax is a type of direct tax that a government imposes on its people’ earnings. The central government is required to collect this tax under the Income Tax Act of 1961. Every year in its Union Budget, the government can adjust the income slabs and tax rates.