Thursday, 4 July 2013

COMPARISON BETWEEN DERIVATIVE AND EQUITY TRADING

In derivatives trading, traders can hold long or short positions for more than 1 day whereas in equity trading, short sell tradings are supposed to square off before the market closing on the same day. Traders must not carry forward their short positions in any way, denying which results in penalty around 20% in auction market Apart, these tips are divided into indexes and stocks. As said in our previous article, virtual scrips like nifty, bank nifty, cnx IT ect., are called as index stocks where as companies which exist in real are said to be stock scrips....


From companies point of view, its easy to get listed in equity trading when compared to derivatives segment which requires certain trading volumes consistently. This is the reason there is a vast difference in the number of scrips which are listed only in equity and scrips which are in both segments. Equity trading is eligible for long and short trades .Short positions must be squared off intraday without fail.Long positions can be carried over for required number of days .Companies listed in equity trading are more than that of future segment.

14 comments:

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