This exercise helped to learn alot about derivatives and its basic functions. Also learnt about MTM,Marigin,Premium,Lot Size. How the physical and cash settlement happens.
Sathish B, , Futures and Options, Cash Settlement, derivatives, Future, lot size, Margin, MTM, Optional, physical settlement, premium, spot market
Hi,
How option contract differ from future contract?
An option gives the buyer the right, but not the obligation, an asset at a specific price at any time during the life of the contract meanwhile, futures contract is the obligation to sell or buy an asset at a later date at an agreed price.