Pillar Of Stock Building

Spot market is the market where stock or ownership of a company traded and immediately the ownership will be transferred to buyer. It is also called as equity market since the all shares are equal in face value. Lot size is the size at which the contracts are traded for future purchase. Expiry date is the date at which contracts are expire. Strike price is the price at which contracts are traded to buy or sell on that price in future. Premium is the amount seller will get from buyers to signing a contract. MTM is the method at which the future contracts cash settlement is done on everyday to Mark to Market. Margin is buying a extra money from brokers. In a future contract, both the buyer and seller have rights to buy and sell. A buyer of CALL option has rights to buy, but no obligations. A seller of CALL option gives rights to the buyer to buy. He has obligations but no rights. A buyer of PUT option gets the rights to sell, but no obligations. A seller of PUT option gives rights to the buyer to sell. He has obligations but no rights. Yes through futures and options it is possible. But in that case there wont be any physical settlement instead cash settlement will be done. We can buy NIFTY Futures and also NIFTY options.In spot market end of the day physical certificate is given to the buyers. But in case of futures instead of physical settlement cash settlement will be done. Suppose the buyer bought the futures at the strike price of 250 but stock went to 260. That difference 10 rupees settled as a cash for buyers and same is adjusted in sellers account everyday.