Working of the Derivative markets

Futures and options offer additional means of trading instrument to the traders , in addition to cash market. The derivative market requires the less investments ,compared to the cash market. The risk involved can be minimized by creating different strategies using cash and futures., cash and options, futures and options or by only choosing options. The derivative markets are settled by the cash transaction, creates ease in doing business .Nifty derivatives turnover is the highest among all the other instruments combined together on the NSE. Nifty derivatives have highest liquidity and hence are preferred choice by the traders. FII also use options , as a hedging tool, to safe guard their investments.
Derivatives market is becoming more popular because of all these factors, with the introduction of mobile based trading.