Tag Archives: Futures and Options

Stock Market Trading

ADVANTAGES AND BENEFITS OF COVERED CALL STRATEGY ‘The biggest advantage of covered call strategy is it increases and improves the odds of successful trading. Another biggest share tips benefit is that it can be implemented in two of the three possible stock movement scenarios. If the stock goes up, it’s profitable. Ifthe stock goes sideways, it’s profitable. The only case when it is not profitable is

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Derivatives Trading

REGULATORY FRAME WORK The trading of derivatives is governed by the provisions contained in the SC(R)A, the SEBI Act, the regulations framed the reunder and the rules and bye-laws of stock exchanges. In this chapter we look at the broad regulatory frame work for derivatives trading and the requirements to become a member and an authorized dealer of the Futures and Options segment and the position limits

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Risk Management

RISK MANAGEMENT NSCCL has developed a comprehensive risk containment mechanism for the Futures and Options segment. The salient features of risk containment mechanism on the Futures and options segment are:    The financial soundness of the members is the key to risk management. Therefore, the requirements for membership in terms of capital adequacy (net worth, security deposits) are quite stringent.   NSCCL charges an upfront

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Option Trading Exercise

EXERCISE SETTLEMENT Although most option buyers and sellers close out their options positions by an offsetting closing transaction, an understanding of exercise can help an option buyer determine whether exercise might be more advantageous than an offsetting sale of the option. There is always a possibility of the option seller being assigned an exercise in  stock market. Once an exercise of an option has

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Trades in the Futures And Options

CLEARING BANKS Funds Settlement takes place through clearing Banks. For the purpose of settlement all clearing members are required to open a separate ban k account with NSCCL designated clearing bank for Futures and Options segment. The clearing and settlement process comprises of the following three main activities. CLEARING SETTLEMENT RISK MANAGEMENT. TABLE 1: PROPRIETARY POSITION OF TRADING MEMBER MADANBHAI ON DAY 1. Trading

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National Securities Clearing

CLEARING AND SETTLEMENT National Securities Clearing Corporation Limited (NSCCL) undertakes clearing and settlement of all trades executed on the Futures and Options Segment of the NSE. It also acts as legal counter party to all trades on the Futures and Options segment and guarantees their financial settlement. CLEARING ENTITIES Clearing and Settlement activities in the F&O segment are undertaken by NSCCL with the help

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