Differences between the spot, futures and option market. spot market is deal and settlement made same day. futures and options deal is made one day and settlement another day. in futures both sellers and buyers have obligations to buy and sell. In options there is no obligations to buy and sell. Futures has MTM and caution deposit and options has premium.

1 Comment
  1. Naresh 2 years ago

    In response to your question

    Your Question 1 :: What is MTM?
    MTM in a futures contract is the process of daily settlement of profit and losses arising due to the change in the security’s market value until it is held.

    Your Question 2 :: who decides the premium and based on what conditions.
    Demand and supply ultimately determine the price of options, several factors have a significant impact on option premiums, which are the spot price, exercise price, volatility, time remaining to expiration, rate of interest and so on…

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