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Derivatives (Futures &
Options) are ideal
instruments to protect your
portfolio against risk. You
can trade with index
movements, hedge and
leverage your portfolio by
limiting risk but keeping
your upside unlimited.
Derivative products
initially emerged as hedging
devices against fluctuations
in commodity prices and
commodity-linked derivatives
remained the sole form of
such products for almost
three hundred years.
Derivatives are contracts
for future delivery of
assets at prices agreed at
the time of the contract.
The quantity and quality of
the asset is specified in
the contract. The buyer of
the asset will make the cash
payment at the time of
delivery. Derivatives are
instruments through which
risk is transferred. There
are various kinds of
derivative instruments viz.
index futures, stock
futures, options, forward
contracts, etc. |
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