Hi friends, It looks that options are more juicy but it is not so. • margin required for option selling is same as of future •for buying deep itm to get delta 1 money required same as futures • if we buy ATM options of suppose nifty, approximately money require is 15000 with delta 0.5. So to get 1 delta we need 2 lots whose money require is 30000 which is somehow close to futures • OTM option buyers most of time loose full capital because it needs strong movement in favor to make money and in market you cannot guarantee it • all of us knows that increase in premium is less than its decrease •if market is choppy or sideways we don’t loose money in future but in options we loose due to time decay • in future we simply need to predict the market direction but in options we need to do extra homework on greeks • in futures all buyers and sellers come at same place. So it has more volume but in option it get distributed among all strike prices. So it looks that we double our capital in options but it is a delusion far from reality.
Stock trading should alwasy be done with good capital. It was never meant for 50000 account and trade worth 5 or 10 lk.
u should have good setup, good capital, good knowledge of the product.
Options are very good instrument if played with calculated risk, with proper study,proper hedges, timely entry and exit based on system u r comfortable with.
Your selection of Strategy and implementation should be based on market considitions or events u r playing for. Yes offcourse u would need good capital.
Brokerage n taxes in Options are less compared to futures. U can take multiple trades as little breakeven is needed and ur turnover wont increase compared to Futures.
Like i sometimes plan an pair entry but due to volatility do not always get good price and timing the entry for different product is not good, so i buy or sell pairs @ different hours or days if swing trading.
I would say , Options trading is better than futures since in options the maximum loss is the premium but is futures trading there could be unlimited loss if you are not maintainnig the stoploss.In short the Options gives you unlimited Profit and limited loss whereas Futures gives you unlimited profit and unlimited loss.
Just these are the fundamental differences between Options and Futures trading.Every asset class gives you good return but one should have better understanding of fundamental as well as technical knowledge of respective asset class. Again it depends on the trading style of individuals.
You are right but trading options is not easy as it. When nifty lot changes to 75 then I started trading in options as it is cheaper. In market we make strategy or predict direction but we cannot guarantee it in particular time and instead of being right I loose a lot of money due to time decay.
Lastly I think for strategy playing options are good but trading on general trend future is better than spot and even option.