First of all, both options and futures are derivatives and
leverage instruments and are therefore inherently riskier than simply trading
stocks itself. Also, both options trading and futures trading can be equally
risky if your ability to produce fairly accurate analysis and outlook of their
underlying asset is no good.
Now, comparing options trading and futures trading, I would say that for beginners, Options Trading is less risky than Futures Trading for a number of reasons.
Firstly, bigger rewards comes with bigger risks. Futures trading is capable of producing return on investment and leverage far greater than can be attained in options trading
Secondly, when you buy call and put option, your maximum risk is limited only to the amount of money you used when buying those options. The worst that can happen is that your prediction is totally wrong and the options simplyexpire worthless. You don't lose more money than that. However, in futures trading, you are subjected to unlimited liability and will be expected to "top up" your daily losses by the end of each day in what is known as a margin call. This daily loss continues as long as the stock continues to go in the wrong direction..............
Now, comparing options trading and futures trading, I would say that for beginners, Options Trading is less risky than Futures Trading for a number of reasons.
Firstly, bigger rewards comes with bigger risks. Futures trading is capable of producing return on investment and leverage far greater than can be attained in options trading
Secondly, when you buy call and put option, your maximum risk is limited only to the amount of money you used when buying those options. The worst that can happen is that your prediction is totally wrong and the options simplyexpire worthless. You don't lose more money than that. However, in futures trading, you are subjected to unlimited liability and will be expected to "top up" your daily losses by the end of each day in what is known as a margin call. This daily loss continues as long as the stock continues to go in the wrong direction..............