Wednesday, 23 August 2017

Reasons Which Make Nifty Future A Better Choice For Trading

Nifty Future
The nifty futures have a very important place in the Indian derivatives world. The nifty futures are the highly liquid contract and most widely traded futures instrument in the Indian derivative markets. The nifty futures are also one of the top 10 index futures contracts traded in the world. Nifty futures allow traders to trade in the 50 stocks index. This makes nifty futures a good representative of the broader economic activity in India. This means if the general economic activity is going up or at least expected to go up then nifty’s value also goes up and vice versa.

This makes trading nifty futures a better option as compare to single stock futures. The reasons which make it a better choice are as follows Diversification- Nifty futures have a diversified portfolio of 50 stocks. As it is 50 stocks’ portfolio, the nifty futures movement does not depend on a single stock. Stocks can influence nifty occasionally up to some extent but not on an everyday basis. Simple we can say, if a trader trade nifty futures, he completely eliminates unsystematic risk and deals with only systematic risk. Hard to manipulate- The movement in nifty is a response to the collective movement in the top 50 companies in India.

Thus, there is no scope of manipulating the nifty index. Highly liquid- Nifty futures are highly liquid a trader can literally transact any quantity of nifty without worrying about losing money. There is high liquidity that a trader can literally transact any number of contracts of his wish. Fewer margins- Nifty futures need much less amount of margin as compared to individual stock futures. The margin of Nifty futures requirement varies between 12-15% to give a perspective. Application of technical analysis- Technical analysis is the best if used with the liquid contracts.

Liquid contracts are not easily manipulated hence they move according to the demand supply dynamics of the market, which technical analysis mainly relies on. Nifty futures trading are required expert help to trade effectively and successfully. Money Classic Investment Advisors is the leading nifty futures recommendations provider. We offer authentic recommendations so that traders may earn the huge return from trading.

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