all about futures and options on the share market

what`s the point of this discussion? Could you explain i in a different way because I just dont understand. Maybe because I`m not from India but I seen that no one else answered it also. What does it mean? i`m confused.

Hi : I've been trading stock options for the past 2 years and what I can advise is it's best to get the basics right. Start off by borrowing books from the library or read from the internet knowledge about investing, stock markets, the emotional aspects of trading. Once you've built your foundation knowledge, then you can go in-depth and focus upon a particular trading instrument be it shares, options, forex that would suit your trading style and area of interest. You then build upon those skills of the particular trading instrument that you wish to explore further. It's not an easy decision to make but it's definitely an important one if you wish to build your financial goal from the particular investment vehicle. Yours Truly, Tony Chai a disabled trader http://options4u.blogspot.com

Futures and options are Derivatives,there are 2 sort of options Calls and Puts,a call option gives the buyer the right to buy ,an example call microsoft 30 sept07 premium 0.9 when you buy 1 call you have the right to buy 100 shares (a contract is 100 shares)microsoft untill the third friday of september 2007 and pay 90 $ for it (without costs!,look to your broker what the cost is)when microsoft rose to 35$ this option is at least 5$ worth (35$-30$) and it means your investment is grown from 90$ to 500$ ,when microsoft didn't reach the 30$ on the exercise date your investment is worthless,you couldn't loose more then 90$. During all the time you can buy or sell the call option,with futures you have not only the right but you must really buy whe you take a long position. When you buy a put option you have the right to sell same example put microsoft 30 sept 07 premium 0.8$. When you buy 1 put you have the right to sell microsoft at 30 $ and pay 80$ for it,when microsoft fell to 25$ the option is at least 5$ worth,when microsoft stood above 30$ on the exercise date your investment is worthless. When you think microsoft should make a big move but you don't know the direction you could buy both and though 1 option is going to be worthless the other gives more then enough return when you're vision is right,the worst case is then microsoft shouldn't move enough and close arround 30$.