Viewing 5 posts - 6 through 10 (of 327 total)
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  • #5966
    bhavani
    Participant
    Rank: Level 7

    Premium: The amount paid by the buyers in the options trade as a deposit is known as the premium.

    Strike price: Each derivative instrument has a standard price above or below which is treated as profit or loss in the settlement date know as strike price.

    Expiry date: Every derivative instrument has a settlement date by which the contract ends known as expiry date.

    Lot size: Each share cannot be trade as single unit in the derivative market hence there is a lot size by which the quantity can be traded.

    MTM : Mark to Market: it is the current market price traded which varies from time to time.

    #6027
    Ramesh
    Participant
    Rank: Level 5

    Margin –  It is a security deposit paid to exchange for executing any future contract.

    MTM – Mark to Market, which is levelling the strike price to the market price by compensating the benefited party.

    Premium – is the amount paid by the buyer to seller when signing a Call/Put option contract

    Strike Price – is an agreed price between seller and buyer on derivative instruments.

    Expiry Date – is nothing but the maturity date of the derivative instruments.

    Lot Size – is the minimum quantity to be traded for any derivative instruments.

    #6035
    Gopalakrishnan
    Participant
    Rank: Level 5

    Margin is the security deposit, Exchange is collected from both the parties and hold it up to expiry of contract.

    MTM is the mark to market – the price different from the contract price is collected & settled on the daily basis.

    Premium is received the price who make the seller sign

    Who received the amount from the buyers for the contract is called premium.

    Strike Price – is the contract price between seller and buyer on derivative instruments.

    Expiry Date – The contract is invalid at every month last Thursday is called expiry date.

    Lot Size – is the minimum quantity to be traded for any derivative instruments.

    #6262
    Swathi
    Participant
    Rank: Level 2

    Margin is the security deposit which is being collected by the exchange for safety.

    MTM is the mark to market, it’s the price which is being agreed by both the seller and the buyer at the point of contracting.

    Premium is the amount which is agreed both by the buyer and the seller, which is given to the seller by the buyer.

    Strike price is the contract price which is fixed by both the buyer and the seller.

    Expiry date is the date after which the contract gets invalid. This happens every last thursday.

    Lot size is the minimum amount of quantity which could be traded

    #6268
    Vijayakumar
    Participant
    Rank: Level 3
    • Margin is the deposit collected by the exchange from the parties entering into the contract (both the parties in case of future & seller in case of options)
    • MTM – Mark To Margin – In future contract, the settlement is done on a daily basis based on the closing value of the asset so the derivative product will also represent the real value of the asset.
    • Premium – The amount for which the seller of the option contract agrees to enter the contract.
    • Strike price – The price (beyond – incase of call option / below – in case of put option) which the seller agrees to compensate the buyer.
    • Expiry date – Expiry date of the future / option contract. On the expiry both the contracts will represent the real value of the underlying asset.
    • Lot size – Minimum number of shares / multiple of the number, which has to be transacted together. generally 1 in spot market & higher in derivatives market.
Viewing 5 posts - 6 through 10 (of 327 total)
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