Option Trading Volumes
Last few years consistently the option volumes have been increasing. Stock exchanges have been creating awareness among the brokers which has many benefits over future trading. Option tools and other software for trading options are also on the rise.
Kindly find the below chart with interesting facts about how the index options have been continuously increasing alongside with stock options.
The total index options have been same for last year and this year but the stock options have increased over the period of time. Consistent increase in turnover talk a lot about how the trades have been performing.
As on date statistics
Leverage is much higher in future which makes the future trading much riskier than an option. Future contract size is also much higher than the option contract size this make options trading favorable. Internationally also the options trading is much higher than the index future trading.
Long option strategy has limited risk and unlimited profit this is mostly in theory. But this gives an enormous opportunity for certain types of options trading. The maximum risk is limited to the premium paid for the options. When things go wrong the stock option becomes worthless and the maximum amount lost is the premium amount.
Consistently BSE and NSE have been among the top rankers in the world for options trading. There are so many reasons behind the kind of success along with high beta and volatility plays a very important role. They have been also very innovative in bringing new products like weekly options.
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Managing risk with Greeks is very crucial. Greeks are Gamma, Theta, Delta, Vega, Rho, Vanna and Vomma. These are broadly classified into primary greeks and secondary greeks. Greek helps you to control, adjust and manage the entire option strategy.
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