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Wednesday 1 November 2017

What is "Future and Options" in Stock Market

Many of the people who get into Equity market aka Stock Market directly only deal with one part of it called “Cash Market”, a market where one can buy and sell shares from quantity 1 to many depending on money one has. There is another part of Equity market called “Future and Options” abbreviated as F&O.

What is F&O :

F&O is Contract based trading instrument which has validity from 7 days to 90 days depending on whether it is for INDEX like NIFTY / BANK NIFTY or individual stocks. In this there is no transaction of shares until the last day of contract and there is just agreement made between Buyers and Seller to abide by contract price and date. The Price in Cash market and Price and various data points in F&O market affect each other.

Future:

Future instrument is a contract between buyer and seller about Future price of a stock or Index. In Indian market Future Contracts are of one month expiring on last Thursday of every month and the new contract starting just a day after that. One can buy individual contract of next 3 months as only 3 Contracts can be active at one time for any stock or Index. Basic component of Contract are Stock name, Future agreed Price and expiry date. So INFY 26 OCT17 FUT means Future contract of Infosys for October month expiring on 26th October 2017.

If one buys Future contract of INFY for October month, buyer is agreeing to buy INFY at price mentioned in future market, at max by last day of contract expiry which is 26th October. Suppose Current Market price of INFY is 900, and October’s Future Price is 920 (because market sentiment is positive), so buyer is agreeing to buy INFY at 920 Rs maximum by 26th October, no matter whether stock price goes down or up.  If stock prices goes to 950 Rs in that month, buyer will make profit because buyer has right to buy same stock at 920 Rs as per contract. If stock price goes down to 880, buyer will lose money because as per the agreement buyer promised to buy INFY at 920 Rs. and vice versa the contract seller will make profit and loss. There can be one more case when INFY stays around 900-905 Rs for whole month and closes at 900 on last day, in this case also buyer will lose money because buyer needs to buy INFY at 920 Rs whereas the market price is 900 Rs and hence contract seller will make profit. 

Now to summarize profit and loss cases for Futures:

Buyer will make money only when stock price moves up from price of future agreement in the Contract month

Seller will make money when stock prices goes down in the Contract Month

Seller will make money when stock prices stays same in the Contract Month

Seller will make money even if stock price goes up by any percentage but after contract expiry date.

As one can see that timing also is one big factor in Future market unlike in Cash market and Buyer and Seller need to be precise enough to make full use of this instrument of stock market. Unlike in Cash market, these Contracts are done in lots and one lot contains many shares, so to be able to use these contracts one needs to have enough capital and margin in their account. The Advantage of it is that brokerage firms let their clients use Margin money to buy or sell Future Contracts and no need to have full money in your account. To give an idea of this, to buy 500 Shares of INFY in Cash Market one needs to have 4,50,000 Rs (500 x 900) in account but to buy same in Future one needs 10% to 50% of total money in account depending on Brokers they are taking service from.

As Options are too big to explain in this post and has two part as “Call” and “Put”, I will be posting it soon as new post :) 

Monday 2 October 2017

iBall Slide PenBook

iBall, known for its innovative and latest technology products, announces its newest Windows-based 2-in-1 ‘iBall Slide PenBook’, that comes with sophisticated design and features to inspire the creative you, and enhancing your productivity and style. The latest PenBook, integrates the most advanced features one would look for. It provides users, the experience of a Tablet with the computing power, software compatibility and overall characteristics of a Laptop. 
Take notes, create lists, sticky notes and draw to your heart’s content — it all becomes an easy-peasy task with integrated Windows Ink on digital pen provided. It is so smooth that it will make you realize what you are missing at present. No lags when you write and its precision will thrill you with the experience. Additionally, the PenBook also showcases a unique Windows Hello – Quick Fingerprint scanner feature, where you will be the password, breaking all traditional stereotype password setups. It also features Cortana with Voice – your personal digital assistant, which offers more ways to keep yourself updated and helps you to remember your tasks. Cortana with Voice works above the lock screen too.  



Key Features:

  • Fingerprint scanner
  • 6000 mAh Li-Polymer battery
  • 10 point Multi-touch Display
  • HD Clarity and IPS technology
  • Priced at Rs 24,999/- 
Inspired with your creativity and productivity, the iBall Slide PenBook sports a 2-in-1 portable and flexible built from durable yet incredibly light aluminum alloy design redefining your personal working space, even on-the-go. Supported by a massive 6000 mAh Li-Polymer battery, the iBall Slide PenBook is perfect for you to optimize productivity and mobility. It is backed by a High Definition 25.65cm (10.1) full capacitive multi-touch display with stunning HD Clarity and IPS technology. With its 10 point Multi-touch Display, use all your fingers simultaneously on the screen, and see how every movement is differentiated and well defined.   

The latest PenBook caters to high-efficiency users seeking to maximize their productivity from the comfort of their home, office, or on-the-go. Microsoft Edge helps you to go beyond browsing for a web experience that’s personal, responsive and all about getting things done Online. With Microsoft Edge, write directly on the Web pages and share your mark ups with others, read online without distractions and organize your reading list for later. 
It also comes with a powerful Intel® Atom™ processor with processing speed up to 1.92 GHz making it perfect for multi-tasking, such as web surfing, working on Microsoft® Office, streaming videos, playing games, etc.

Speaking on the launch, Mr. Sandeep Parasrampuria, (CEO and Director – iBall) said, “Our latest 2-in-1 iBall Slide PenBook, is a world class offering with latest technology wonders of  Windows inking, Hello and Cortana. It’s the next level device for those who embrace digital innovations and look for the best in technology.”

On its entertainment facet, Dual speakers is embedded to deliver surround sound experience. It also sports 5MP auto-focus camera and a front 2MP camera for video chatting. Equipped with USB Type C with Data, it also supports various connectivity options, which include in-built Dual Band Wi-Fi and Bluetooth® for faster and seamless Internet and data sharing. Simplifying it further, is the Micro HDMI port to keep the users hooked on. Along with these, it also supports Micro SD extension with 2 GB DDR3 RAM and 32 GB in-built storage expandable up to 128 GB.

The iBall Slide PenBook shall soon be available at all the leading retail stores across India, priced at ₹24,999/- only.