Forex Digest

what is future option trading?
or what is future option trading - future trading?
Explain please!

You got a pretty good explanation of what a future contract is at

http://answers.yahoo.com/question/index; _ylt=AlJcZ1fKly9sI.2hmT5TYATI5HNG;_ylv=3 ?qid=20090725210805AAf5KiB

so I will not repeat that information here.

An option is a contract between two parties, a buyer (holder) and a seller (writer). At the time a options contract is created the buyer pays the seller a fee (premium) and in exchange the seller gives the buyer the right, but not the obligation, to make a specific trade in the future. The options contract specifies

What is to traded (the underlying)
The price at which the trade is to take place (strike price), and
When the trade may take place.

When the underlying is shares of stock, it is called a stock option. When the underlying is a futures contract, it is called a futures option.

Most options have standardized terms and are traded on an exchange such as the Chicago Board Options Exchange (CBOE) for stock options or the Chicago Mercantile Exchange (CME) for futures options. Buying and selling options on futures is future option trading.

2009-07-25 21:14:19 by I own you

CFTC to holds a Public Meeting to Examine Futures and Options Trading in the Metals Markets Washington, DC United States Commodity Futures Trading ...

in future trading we can sell or bye the stocks at any time

In finance, a futures contract is a standardized contract, traded on a futures exchange, to buy or sell a standardized quantity of a specified commodity of standardized quality (which, in many cases, may be such non-traditional "commodities" as foreign currencies, commercial or government paper [e.g., bonds], or "baskets" of corporate equity ["stock indices"] or other financial instruments) at a certain date in the future, at a price (the futures price) determined by the instantaneous equilibrium between the forces of supply and demand among competing buy and sell orders on the exchange at the time of the purchase or sale of the contract. The future date is called the delivery date or final settlement date. The official price of the futures contract at the end of a day's trading session on the exchange is called the settlement price for that day of business on the exchange.
A futures contract gives the holder the obligation to make or take delivery under the terms of the contract, whereas an option grants the buyer the right, but not the obligation, to establish a position previously held by the seller of the option. In other words, the owner of an options contract may exercise the contract, but both parties of a "futures contract" must fulfill the contract on the settlement date. The seller delivers the underlying asset to the buyer, or, if it is a cash-settled futures contract, then cash is transferred from the futures trader who sustained a loss to the one who made a profit. To exit the commitment prior to the settlement date, the holder of a futures position has to offset his/her position by either selling a long position or buying back (covering) a short position, effectively closing out the futures position and its contract obligations.
Futures contracts, or simply futures, (but not future or future contract) are exchange traded derivatives. The exchange's clearinghouse acts as counterparty on all contracts, sets margin requirements, and crucially also provides a mechanism for settlement.

2008-12-28 07:08:25 by ncr_789

I have a 3 questions
1)What are the margins for doing future and option trading.
I think I do not need $N to trade $N future or option.

2)What is the best/largest company offer online future and option trading?

3)What is future option trading, is it different from both future and option trading?

<<<1) What are the margins for doing future and option trading.>>>

It varies by brokerage. All brokerages have to meet SEC minimums, but they may require more margin than the SEC requires.

For example, here are the margin requirements for one brokerage

Futures:

http://www.tradestation.com/LW_Reports/r eport.pdf

Stock Options and Index Options:

http://www.tradestation.com/brokerage/re quirements.shtm#futures

<<<I think I do not need $N to trade $N future or option.>>>

Correct.

<<<2) What is the best/largest company offer online future and option trading?>>>

The "best" depends on you and the way you trade. What is best for one person may not be best for another.

<<<3) What is future option trading>>>

A future option is an option where the underlying security is a future contract, so future option trading is buying and selling options on futures.

<<<is it different from both future and option trading?>>>

It is one form of option trading. John might be trading options on Intel stock and Ken might be trading options on frozen OJ futures. Both would be trading options, but only Ken would be future option trading.

2009-07-29 21:14:04 by I own you

i am just an invester in nse india, and i would like to know more about market, can any one help?i entered market only last year and i am in chennai.

There are lots of good books out there on the market and options my Indian friend. I wish you the best of luck!!!!! There was a book I read a LONG time ago, and PART of its title was....who wins, who loses and why....I remember it being for the beginner and very explanatory in all aspects of the market, and I reme mber enjoying reading it, although I already had half a grasp on most of the stuff in it, it covered EVERYTHING..it may still be out there...and due to what I remembered from it, I have recommended to a handful of people who have wanted a broad, yet still descriptive, overall view on the markets as a whole. That's only part of the title though.

2006-10-28 07:40:55 by ums

Please visit www.StagecoachTrading.net and watch the video demonstration. It will walk you through a trade in the S&P 500 and show you how a round turn trade is placed. You can even download a demo account to 'paper trade' before you invest any money. It is always a good idea to get as much simulated trading experience as possible before trading with real money. Futures trading can be risky.

2007-12-08 08:53:29 by Samresh K