We recommend reading this chapter on Varsity to learn more and understand the concepts in-depth.
Key takeaways from this chapter
- The forwards’ contract lays down the essential foundation for a futures contract.
- A Forward is an OTC derivative that is not traded on an exchange.
- Forward contracts are private agreements whose terms vary from one contract to another.
- The structure of a forwards contract is pretty simple.
- In a forward agreement, the party agreeing to buy the asset is called the “Buyer of the Forwards Contract.”
- In a forward agreement, the party agreeing to sell the asset is called the “Seller of the Forwards Contract.”
- A variation in the price would impact both the buyer and the seller of the forwards’ contract.
- Settlement occurs in two ways in a forward contract – Physical and Cash settlement.
- A futures contract reduces the risk of a forward contract.
Nice work! This has to be one of the most professional video that I’ve ever seen. It had my attention from the start to the very end of the video. Thank you for this!
Madhav
Happy to note that, thanks 🙂
why is there the v sign and next vedio option in the end . cannot read the key points
Please see the key takeaways right below the video, we have typed them out for your reference.
Hi Prateek,
I wanted to know whether the stock prices of Equity shares gets affected due to derivatives or not. If Yes, how does it actually affect.
Also, please explain how whole Nifty50 index can be an underlying asset if the initial moto of it is only speculation.
Ur lectures are very nice.
Thanks
Ram, its the other way round. Prices influence the derivatives. Nifty 50 is not just for speculation, its also benchmarking, hedging, investment etc.
If the price went up, the buyer would be happy, right? Because he is going to get the gold at the contracted price (which is lesser than the current market price of gold) from the seller. And the seller would be unhappy. But the video says the other way.
Or am I missing something here?
Nice videos by the way!!!
Need to check the video, could be a voice typo. But a buyer benefits when price increases and seller benefits if price decreases.
I was having same confusion. Thanks for the explanation.
Sure, happy learning 🙂
video not playing
Can you check on Youtube directly?
https://www.youtube.com/@varsitybyzerodha
i want to lear n trading from stating, but i don’t know to to start and from where to start,
So pls give some ideas for the trading, from where to start to learning, which steps to follow. To make the carrer in trading.
So pls reply to me on this mail([email protected])
Please do read all the content available here, that will help you kick start your journey 🙂
can video available in hindi
Hi Sir,
I want to trade in FUTURE with NIFTYBANK (3 month cycle). How to place the strike price? (want to know the format). can you give one example considering todays LTP.
Hey Wilson, I’d suggest you call the support desk for this, they will guide you.
Hii,
On Friday I got a profile of 1400 and it’s Tuesday now but still not showing in my Account I know what is the reason.
I’d suggest you call the support line for this, Abhi.