List of Derivatives Articles

Futures and Options represent Derivatives of the stock market. These Derivatives are the financial instruments deriving their values from an underlying such as currency, gold, or the stocks of a company.

To have expertise in investing and making profits, you need to be well-versed with all trading terminologies. Among various investment instruments that can allow you to earn hefty returns, Over-the-Counter or OTC derivatives are one of them.

A European option can be exercised only at the expiration date, whereas the American Option can be exercised at any time on or before the expiration date. The right of the option buyer is a lot more powerful in an American option.

Whether you trade in stocks, commodities or any other financial instrument, it can take place across a number of different platforms and in a number of different ways. However, some commonly employed trading methods have

Max Pain is the financial situation that is defined by the strike price of most live options contracts.

One of the most popular and widely used words in the lexicon of F&O trading is open interest. As the name suggests, open interest represents the open futures and options positions in the market that are yet to be closed out or exercised or expired.

Basis in derivatives is the difference between the spot price (current price) and the strike price (predefined price) of the futures contract.

In financial markets we all understand volatility as something very unstable and very bad.

Rollover may sound like a complex and high flying esoteric word but in reality it is quite simple. You must have heard the word rollover quite often concerning futures. Traders often refer to rollover in the stock market as long rollover or short rollover.

Consider you have a barrel of wheat that you want to sell three months from now, but you fear that the prices might fall in the future.

Index Options are derivative instrument, which means their value is derived from the movements in the underlying index.

Minimum margin or maintenance margin is the number of stocks investors must maintain in their margin account.

A common belief in the Indian financial market is: the more complex the strategy, the higher is the potential for profits. The same goes with Options trading and its numerous complex strategies.

If you are in the capital market, then volatility is part and parcen of the game. Of course, by volatility we mean that the markets fluctuate and add to your risk.

If you’re planning to become a successful trader, it’s important to learn how to spot sideways markets and find ways to make the most of them.