Futures and options are derivative investments used in trading. In both futures and options the date on which the trade is to be executed, the price at which the asset is sold/bought are pre-determined by the buyer and seller.
In options, the buyer has the right to buy/sell but not the obligation to do so. Whereas in futures, the buyer and the seller has the right to buy and right to sell respectively and are obligated to trade unless the holder’s position is closed prior to the expiry date
.In call option the buyer has the Rights to Buy the asset from the seller of the contract at the strike price but is not obligated to do so.
In put option the buyer has the Rights to Sell the asset from the seller of the contract at the strike price but is not obligated to do so.
, , Futures and Options, Call option, derivative instrumements, expiry date, FUTURES AND OPTIONS, lot size, MTM, premium, Put Option, spot market, strike price
