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Business News/Topic/    Derivatives Boom

THE DERIVATIVES BOOM

Everyone wants to be a millionaire. While trading in equities seems to be a popular way of doing that, investors these days have taken to derivatives trading to get rich quickly. But with all such ‘get-rich-quick’ schemes, there's a huge caveat: only ten percent of investors in the futures and options trading segment make any money. SEBI, the markets regulator, has directed brokers to run disclosures explaining the risks of F&O trading on their websites — but that doesn't seem to deter investors. Trading volumes in derivatives hit a record in August, while average daily turnovers have surged 34.5 times from FY19. Zero-day trading options, that have cash settlements and are cheaper than monthly options, have led the charge. So what are futures and options? This collection contains explainers, deep dives and perspectives from experts. Follow Mint's in-depth coverage into this increasingly popular segment.
Buying options is like buying a lottery— buyers only stand to gain if there is a big swing in the price of an underlying index or stock. Premium

New lottery: The human cost of F&O trade

11 min read . 05 Nov 2023
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