What is the role of exchange in derivative instruments?

[Naveen]

exchange as to play a important role because in derivatives because in derivative market the settlement is done on MTM day to day basis so it is necessary  to function the market

[Lakshmisudha R]

Exchange facilitates smooth trading of derivative instruments by

collecting margin amount from both buyers and sellers

Settling the price difference in the contract (MTM) on day to day basis to buyers and sellers

[kanakaraj]

Exchange settles the difference amount on day to day basis from the deposit made by buyer and seller in future contract.

[KRISHNA KUMAR MS]

• Creates various derivative products based on equity for trading in the market, depending upon the need.
• Fixes the amount of refundable margin to be collected from both the parties in case of future contract & from seller in case of options by the Brokers.
• Settles the buyer & seller on a day to day basis (MTM) on future and seller of Options.
• In case of any dispute, makes sure that the responsibility is taken care by the broker.

 

[sreevalli]

Exchange facilitates smooth buying and selling of derivative instruments

Settling the price difference in the contract (MTM) on day to day basis of traders

They collect margin amount from the traders

 

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