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Karthik replied to the topic Why should a trader need the futures/call/put? in the forum Essentials of Trading Instruments 7 years, 9 months ago
in futures/call/put contract, a trader could make or lose money on a daily basis without even investing in stocks.
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Karthik replied to the topic How option contract differ from future contract? in the forum Essentials of Trading Instruments 7 years, 9 months ago
in the option contract, the seller of the contract will have the rights but no obligations for which he pays the premium, where as in future contract, the buyer and seller have both rights and obligations.
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Karthik replied to the topic What is call option and PUT option? Who decide the premium? in the forum Essentials of Trading Instruments 7 years, 9 months ago
call option buyer- where a buyer has the rights but no obligations to buy from the seller on the agreed price on the future fixed date.
put option buyer- where a seller has the rights but no obligations to sell to the buyer at the agreed price on the future fixed date.
premium- is decided by both the buyer and seller of the contract by n…[Read more]
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Karthik replied to the topic What is the role of exchange in derivative instruments? in the forum Essentials of Trading Instruments 7 years, 9 months ago
exchange is the witness between the buyer and the seller and ensures that both parties get their shares of money in case of change in price of the commodity on a daily basis and ensures the execution of the contract on the due date.
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Karthik replied to the topic What is Futures contract? in the forum Essentials of Trading Instruments 7 years, 9 months ago
a future contract is an agreement between a buyer and seller to buy or sell a particular share on a future date at an earlier fixed price.
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Karthik replied to the topic What are derivative instruments? in the forum Essentials of Trading Instruments 7 years, 9 months ago
futures and options
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Karthik replied to the topic What is the Pro / Cons of Equity market from traders’ perspective? in the forum Essentials of Trading Instruments 7 years, 9 months ago
pros:
traders could liquidate the shares via trading.
either profit or loss but some amount of money will be returned.
cons:
to make more money, more money needs to be invested (for professionals)
high risks involved due to market volatility.
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Karthik replied to the topic What is Spot / Cash market? in the forum Essentials of Trading Instruments 7 years, 9 months ago
spot/cash market is the place where exchange of money and shares take place.
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Karthik replied to the topic What is Equity market? in the forum Essentials of Trading Instruments 7 years, 9 months ago
equity market or share market is the market where trading of stocks take place.
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Karthik replied to the topic Who decide the stock price? in the forum Basics of Stock Trading 7 years, 9 months ago
buyers and sellers decide the stock price, mostly depending upon the previous day closing price.
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Karthik replied to the topic What is positional trading and Intraday trading? in the forum Basics of Stock Trading 7 years, 9 months ago
intraday trading- buying and selling the same stocks within the day.
positional trading- buying and holding the stocks for a certain period of time eg, 1 week and then selling it.
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Karthik replied to the topic Is Stock trading is gambling or Business? How? in the forum Basics of Stock Trading 7 years, 9 months ago
for anyone who enters the stock market without considerable knowledge of trading and analysis is considered a gambler who doesn’t know the amount of risk taken by oneself.
anyone who enters the stock market with a strong basic knowledge on trading and analysis, and takes calculated risk on the money invested in the market, consider it as a business.
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Karthik replied to the topic What is long / short / long unwinding / Short Covering? in the forum Basics of Stock Trading 7 years, 9 months ago
long position- buying a stock, expecting the price of the stock to rise.
short position- selling a stock which one does not possess, expecting the price of the stock to go down.
long unwinding- selling a stock which has been bought at long position.
short covering- buying the stocks after a short position which one has to trade within the…[Read more]
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Karthik replied to the topic What is Trade Plan? Why it is essential in the forum Basics of Stock Trading 7 years, 9 months ago
after the initial analysis of the market, there should be a trade plan about the shares to trade and about the risks to be taken.
it gives you the knowledge and discipline on how to handle the shares and money and it will be helpful on the long run.
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Karthik replied to the topic Why do people choose stock trading? in the forum Basics of Stock Trading 7 years, 9 months ago
stock trading is the phenomenon where they could make money by buying and selling shares.
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Karthik replied to the topic What is the difference between Trading and Analysis? in the forum Basics of Stock Trading 7 years, 9 months ago
analysis is the part where you read and understand the market behavior using graphs and tables.
buying and selling shares in the market is called trading.
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Karthik replied to the topic What is online trading? in the forum Basics of Stock Trading 7 years, 9 months ago
products bought and sold on the internet is called online trading.
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Karthik replied to the topic How much time required to do trade? in the forum Basics of Stock Trading 7 years, 9 months ago
a trade happens within a second if the buyer and seller agree at the same price, but if there is difference in the price of a buyer and seller, then they have to wait in the queue.
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Karthik replied to the topic How Stock exchanges ensure the traders counter party risk? in the forum Basics of Stock Trading 7 years, 9 months ago
if the buyer does not have sufficient funds in his account at the end of the day, then the exchange transfers money from the broker’s caution deposit to the seller.
if the seller does not have the shares in his account at the end of the day, then the exchange buys shares from the auction market and transfers it to the buyer, thus the seller is…[Read more]
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Karthik replied to the topic What happens if I quote high price to buy a stock compared to its current market price? in the forum Basics of Stock Trading 7 years, 9 months ago
when a buyer quotes the price of a stock at a higher price than it is currently being traded in the market, he gets the stocks required at the price which the best seller has quoted. this is because, when a buyer quotes a price, the exchange considers it as the maximum price upto which the buyer is willing to pay and thus he meets the best s…[Read more]
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