Friday, 18 September 2015

Make Money By Trading In Futures & Options

Make Money By Trading In Futures & Options - Money Classic Blog
For a trader who wants to trade in the stock markets, he can trade either in the cash segment, Futures segments or options segments. In case of cash segment, the trader pays for the current prices of the stocks. In case of futures, the trader pays for a contract in the future day. There are many tactics to trade in the futures market. Out of them the most effective is using spread technique for trading in the futures markets. Spread technique is one among the favorite for most of the traders. It is a conservative way of trading.

In case of spread technique a pair of stocks or the commodities is selected having similar movements and same values. The two stocks can be two different stocks from the same exchange. They can also be two same stocks or the commodities in two different exchanges. After selecting the two stocks, one of the stocks is shorted and one of them is longed. Thus both the buy and sell trades are executed at the same time and at same price. Now the loss in one of the stock is balanced by profit in the other. Now if the trend is continued in the same direction the profit is incurred in one of the stock. Thus there are chances of making the profits irrespective of the market trend. The trader will make profits in both the cases of uptrend and down trend. The spread technique has many variants. It is one of the most used techniques for trading in the futures markets.

If the trader is a beginner in the field of stock market and has less knowledge about the financial markets, they can take the advice of the advisory firms. These advisory firms provide accurate stock market tips and give appropriate buy and sell signals. Also they provide proper stop loss levels for the trade.

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