Tag Archives: Derivatives Market

Market Movement

The J-Hook Pattern    The J-Hook Pattern is another example of being alerted when a gap up could occur. The J-Hook Pattern occurs after a trend has had a fairly strong run up. It backs off for a period, most likely profit taking. The stochastics do not get back down to oversold, they start leveling out and curl back up near the 50 area.

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Gaps At The Top Of A Trend

A gap that occurs well after the beginning of a trend reversal, where stochastic are still in the midrange of an uptrend, has different implications. How do you distinguish whether a gap is a potential measuring gap? Evaluate where the stochastic are in the trend. If they are still relatively low, the trend has more room to create another gap before getting to the

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Money Making Candlestick

Money Making Candlestick Formations Candlestick Line   Hammer An important bottoming candle-stick line.  The hammer and the hanging man are both the same line, that is a small real body (white or black) at the top of the session’s range and a very long lower shadow with little or no upper shadow.  When this line appears during a downtrend it becomes a bullish hammer.  For

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Client Broker Relationship in Derivative Segment

CLIENT BROKER RELATIONSHIP IN DERIVATIVE SEGMENT. A trading member must ensure compliance particularly with relation to the following while dealing with clients: Filing of “Know Your Client” form. Execution of Client Broker Agreement. Bring risk factors to the knowledge of client by getting acknowledgement of client on risk disclosure document. Timely execution of orders as per the instruction of clients in respective client codes. Collection

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Introduction To Options

INTRODUCTION TO OPTIONS In this section, we look at the next derivative product to be traded on the -NSE, namely Options. Options are fundamentally different from forward and futures contracts. An option gives the holder of the option the right to do something. The holder does not have to exercise this right. In contrast, in a forward or futures contract, the two parties have

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Introduction To Futures And Options

INTRODUCTION TO FUTURES AND OPTIONS In recent years, derivatives market have become increasingly important in the field of finance. While futures and options are now actively traded on many exchanges, forward contract s are popular on the OTC market. In this chapter we shall study in detail these three derivative contracts. . FORWARD CONTRACTS A forward contract is an agreement to buy or sell

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Index Derivatives

 INDEX DERIVATIVES Index derivatives are derivative contracts which have the index as the underlying. The most popular index derivatives contracts the world over are index futures and index options. NSE’s market index, the S&P CNX NIFTY was scientifically designed to enable the launch of index based products like index derivatives and index funds. The first derivative contract to be traded on NSE’s market was

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Chapter Two Market Index

CHAPTER TWO MARKET INDEX To understand the use and Function of the Index derivatives Markets, it is necessary to understand the underlying index. In the following Section, we take a look at index related issues. Traditionally, indexes have been used as information sources. By looking at an index, we know how the market is faring. In recent years, indexes have come to the forefront

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Nse’s Derivatives Market

The derivatives trading on the NSE commenced with S & P CNX Nifty Index futures on June. 12.2000. The trading in Index options commenced on June 4. 2001 and trading in options on individual securities commenced on July 2. 2001. Single stock futures were launched on November 9. 2001. Today, both in terms of volume and turnover. NSE., is the largest derivatives exchange in

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Exchange Vs Otc Derivatives Markets

Derivatives have probably been around for as long as people have been trading with one another. Forward contracting dates back at least to the 12th century, and may well have been around before then. Merchants entered into contracts with one another for future delivery of specified amount of commodities at specified price. A primary motivation for pre-arranging a buyer or seller for a stock

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