Breaking Alert - 8 New Stocks Entering Futures and Options

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Breaking Alert - 8 New Stocks Entering Futures and Options

October 01, 2021
Breaking Alert - 8 New Stocks Entering Futures and Options

The futures and options (F&O) contracts on 8 additional securities are being introduced today. These are as follows:

These securities have been added to the futures and options segment based on the stock selection criteria prescribed by the Security and Exchange Board of India (SEBI). It takes into consideration parameters like average daily market capitalisation, average daily traded value, the market-wide position limit in the security and the quarter sigma values.

 About F&O Segment

A future is a derivative contract where trading takes place via a regulated exchange (such as BSE, NSE).Simply put, trading of contracts takes place instead of shares. Here the buyer and seller agree to buy / sell on today’s price but will settle the contract on or before settlement date also known as expiry day.

For example, instead of buying 100 shares of Stock ABC at Rs. 1001, you will buy contract of ABC at Rs.1002, on or before expiry day you will square off your position. The benefit of this is in order to purchase 100 shares, you have to pay the full amount but to buy a futures contract you will be paying say 20% of total value.

An option is a complex derivative contract which gives buyers contract rights to buy or sell at a predefined price (known as strike price). However there is no compulsion to do so. It’s a choice to exercise your right. To obtain this flexibility the buyer of a call or put option has to pay a premium.

As you may have observed, options trading essentially happens on premium and not on actual share price.                                                                                                      

For more understanding on futures and options and to check out the new securities being listed under F&O today, do watch these videos.

New addition to Future and option: https://youtu.be/ljEwkPtDmp0                                

Espresso Future and Option basic with call option:  https://youtu.be/wHjXj1pVu80      

Espresso Future and Option basic with Put option:  https://youtu.be/Ij5zKCmDMho        


Credits:

Chintan Shah and Sinduja Venkatachalam

Chandresh Khona
by Chandresh Khona

Product Offerings Head

A teacher, writer, travel buff and now Espresso's Product Offerings Head. Ten years here has allowed me to lead the digital team at Sharekhan. My true passion lies in stock market charts.