Distinguishing the Difference between Futures and Option Trading
Futures and options are incredible financial instrument to trade in financial market. This instrument offers traders with an easy way to speculate on the price fluctuation of the assets including commodities, stocks and currencies. However, Futures and Options Trading are different. This points out the benefits and risks of Future Trading and emphasizes the importance of the learning the basics. It is a useful guide for beginners who want to explore futures and option trading. Futures vs. Options; Know the Difference Future contracts are agreements to buy and sell the underlying assets at a certain price and time. Both can be set in advance. Well, the price of the future contract depends on the expected future price of the underlying asset. On the other hand, options give the buyer the right however, there is no obligation to buy or sell the underlying asset at a pre determined price. Hence, the primary difference is the obligation to buy and sell the assets. In simp...