Re: Derivatives : All about Futures
@ Crazyboy...
Sorry for a very late reply.
Options are different from Futures. But they belong to the derivatives segment. Article on Options is being written and shall be published soon.
About Futures, you need to pay the contract fees at the beginning, and if you want to take the delivery you'll need to pay all the money at the end of the contract date. But during the period when the futures contract is active you need to keep the difference between the market price and the strike price in your account. For example you have a contract to buy 1000kg wheat at 10/kg and the price falls to 8/kg you need to have Rs 2 * 1000 = 2000 Rs in your account . If price goes above 10, then the other party needs to have the amount equal to the differnce in the current price and the strike price in the account while, you dont need to keep any money rather you can take out the money.
I hope I could make it clear enough.
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