Feedback Message Board

Futures : Futures are a contract wherein you have to buy a specified share at a specified price on a specified date. It is compulsory to buy the share on that particular date. In option it is not compulsory.

Example : Say the current price of Infosys is Rs.1550.00. I enter into a February Future to buy Infosys at Rs.1700.00. Now it is compulsory for me to buy Infosys at Rs.1700.00 in February 2008.If the price of Infosys in February is say Rs.1600.00 then I make Rs.100.00 loss but if it is Rs.1800.00 then I make Rs.100.00 profit. In option I pay say Rs.20.00 premium and then it is not compulsory. If price is Rs.1600.00 I will not buy in Feb if I am having Option.