in stock market i find the term futures and options ? what
was the meaning of that sensex futures and options
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Answer Posted / sirisha
futures and options are derivative instruments to hedge
against price fluctuation risk,they both are entered through
contracts.
future contract is a standardized contract where in one
party agrees to buy/sell a lot, of shares at a pre
specified rate on a future agreed date.it is traded on an
exchange floor (ex: bse and nse).
option is contract where buyer acquires a right (but not the
obligation) to buy/sell qty of shares at p respecified rate
at an agreed future date.there are two option contracts
1.call option(right to buy)2.put option(right to
sell).sensex f&O are index futures and options
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