Equity Derivatives are instruments whose values are partly derived from one or more underlying equity asset class. Futures and Options are the most commonly-traded equity derivatives products. You can engage in equity derivatives trading to hedge risks associated with long or short positions, or to speculate on the price movements of stocks or indices.
Benefits of Equity Derivatives
The following are the ways in which you can benefit by trading in equity derivatives:
- Hedging and Risk Management – Analogous to purchasing an insurance policy, you can use this mechanism to reduce the risks of adverse price movements in stock prices through equity derivatives trading.
- Leverage – When trading in equity derivatives products, this mechanism allows you to gain greater exposure by investing smaller amounts.
- Arbitrage – You can make profits by exploiting the mispricing of the same stock in equity derivatives markets and cash market.
- Liquidity – The continuous flow of information and transparency due to price discovery enhances liquidity in the equity derivatives market.
- Low transaction costs – The transaction costs are low as equity derivatives trading is based on margin money.
How to Trade Equity Derivatives?
You can now use any of our online or offline multi-trading platforms to invest in equity derivatives products from your comfort zone. Follow the below mentioned procedure to make trading in derivatives much easier for yourself.
- ITS: Now engage in equity derivatives trading in an instant by logging in by using = our mPowered trading platform - an easy to navigate and speedy transactional channel.
- Mobile App: You can trade in equity derivatives on the Go with our Mobile Trading App on your Android, i-Phone or i-Pad. Give a miss call on on 08010945114 to download the app.
- Call N Trade: Never miss out on trading opportunities in equity derivatives products. Call N Trade using our Centralised Dealing Desk, call 33553366 (Prefix STD Code) and speak to our trained telebroking executives to place your order at no extra cost.
- Visit our nearest branch. Click here to find our nearest branch.
Get all your queries answered here
An option is a financial derivative that represents a contract sold by one party (the options writer) to another party (the option holder)
The contract offers the buyer the right, but not the obligation, to buy (call) or sell (put) a security at an agreed-upon price (strike price) during a certain period of time on a specific date (expiration date).