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This topic contains 314 replies, has 305 voices, and was last updated by  Divya E R 8 months ago.

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  • #5224
     EQSIS 
    Keymaster

    What is the Pro / Cons of Equity market from traders’ perspective?

    #5674
     Abirami Duraisamy 
    Participant
    Rank: Level 5

    Pros:

    On buying the shares, the ownership of the company will be transferred, but not happens with derivative markets.

    The percentage of profit/ loss is relatively less compared to derivative markets, hence reduces the risk.

    Cons:

    The investment required to buy the stocks is high, since the settlement happens immediately.

    If the analysis shows that the price will go down but if the stocks are not in hand, the opportunity can not be utilized in equity, wherein derivative markets provides contracts to benefit from the scenario.

    #5959
     Padmavathi Sukumar 
    Participant
    Rank: Level 3

    Pros of Equity market – Reduced risk in terms of profit/loss. Shares are in the buyers account and similarly payment in the sellers account by end of day

    Cons of Equity market – Short position can be created only at the traders risk. Full price of trade has to be pid and all shares delivered by end of day

    #5963
     bhavani 
    Participant
    Rank: Level 7

    Pros: 1)Risk is low compared to derivative market 2) have got rights to receive dividends

    Cons: 1)Full cash payment 2)cannot realize profit in day to day basis 3)no positional short

    #6031
     Ramesh 
    Participant
    Rank: Level 5

    Pros: Deals are settled in the same day. Hence counter party risk is reduced to some extent.

    Cons: It requires considerable investment as compare to future/Options.

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