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In a future contract the buyer or seller can buy or sell shares with obligation. In an option contract the buyer has the rights to buy or sell shares without obligation.
in future contract both buyers and sellers has the rights to buy and sell the shares but with obligations.
in option contract buyer has the rights to buy the shares but with no obligations.
Both Futures & Options together forms the Derivatives market.
Futures :- Both buyers & sellers gets the rights to buy & sell respectively with obligations. The profits or loss are realized on a daily basis based on the price movement with respect to the agreed price.
Options :- Only the buyer gets the rights to buy (call) or rights to sell (put) without any obligations. The buyer gets the profit only if the price moves above / below the strike price. The seller gets the premium at the time of selling the contract.
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Roboto Slab’; font-size: 13px;”>In future contract ,both buyers and sellers have the rights to buy and sell the shares ,but with obligations.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Roboto Slab’; font-size: 13px;”>In option contract ,buyer has the rights to buy the shares, but with no obligations.</p>
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