In futures exchange will maintain refundable margin from both the parties ,and manages the trade. In options it deals with the premium for the deal and executes it.Derivatives are financial instruments that derive their value in response to changes in interest rates, financial instrument prices, commodity prices, foreign exchange rates, credit risk and indicesMargin: The deposit amount paid to exchange by both buyer and seller to sign the future contract, which is refundable.
MTM – Mark to Market : Day to day leveling of price movement. Profit/loss will be realised on daily basis.
Premium – The money paid to seller of the contract for signing the option contract.
Strike Price- The agreed price printed in the option contract.
Expiry Date- The maturity date/ the validity date mentioned in the contract.
Lot size – Number of shared covered in the contract.
