What is Futures trading? Can anyone explain it in layman terms with Examples please?
Q. Please give real life examples like NIFTY Futures or something like that so that i can relate. Can we trade in futures of any stock? Like Infosys Futures, Reliance Futures or Tata Steel Futures, etc?
Asked by Constantine - Fri Sep 11 10:37:07 2009 - - 4 Answers - 0 Comments

A. Futures means buying or selling for the future. Nifty futures are opened for 3 months. Nifty futures are available as lots. ie, one nifty future contract contains 50 derivatives of nifty. Let the nifty be at 4800. And you think nifty may touch 5000 next month. Then you can buy some lots of nifty futures (If you think nifty can come down on october say 4700, then you sell futures). Value of nifty future may be playing around the actual nifty value. Suppose the market value of nifty future for october is now at 4850. You can buy 1 or more lots of futures now. Wait for an appropriate time to sell. or wait for the last Thursday of october (when the nifty oct. contracts expire).
Answered by Lari hal - Fri Sep 11 11:43:34 2009

Of the following statements about futures trading, which one is INCORRECT?
Q. A. There are no specialists on futures exchanges. B. All futures contracts are eligible for margin trading. C. Trading is halted for the day if the prices reach the daily limit. D. The uptick rule applies to the shorting of futures contracts.
Asked by Miss Yahoo - Sun Jun 8 23:54:21 2008 - - 1 Answers - 1 Comments

A. Technically, D is correct, because the Uptick Rule was abolished almost a year ago. It no longer applies, and when it did, it applied to more than just futures contracts. It covered short-selling in general.
Answered by curtisports2 - Mon Jun 9 00:03:05 2008

Is it possible to use futures contracts to hedge exposure to foreign bonds?
Q. If one were to purchase bonds from a foreign country, like Canada, Australia, etc, can futures be used to hedge exposure to the foreign currency. Also, do FX contracts actually mirror cash/spot prices?
Asked by Tom B - Sat Jun 16 19:42:03 2007 - - 1 Answers - 0 Comments

A. Sure...you can short (sell) the foreign currency of the country you are investing in. That way if the currency goes down you lose money on your bonds (when you buy back US dollars) but you would make money on your futures contract.
Answered by Randall - Sat Jun 16 21:19:30 2007