What is derivative trading

Derivative trading is trading which has some Index or Equity stocks as its underlying base. These are derived contracts from their base items. We call them Futures and Options.

These trades are done mainly to do risk mitigation (hedging) and to predict what will happen to the underlying base (speculation).

For details, go through the introduction section of NCFM Equity Derivative Module by NSE. Use google to find this pdf since it is NOT available in NSE website for free.

Edit:

Also found an interesting link to learn derivative.

http://content.icicidirect.com/learning/futures/overview.htm

Here they teach you step by step.

Edit:

I found the original link, which has got all modules.

http://content.icicidirect.com/learning/university.htm

I complete Futures Module, its pretty easy.

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