Hi all,
First of all thanks to this wonderful forum where I have learned so much.
I have a doubt in futures derivative. Have noticed that sometime the futures price say for example XYX stock, is at 100rs but the actually spot price is 120RS for the same,,, obviously at a discount.
Now I want to know what are the implications for this.
For example, even though the spot price is 120rs, I buy a contract lot for 100rs and later sell it for a higher price say 150rs... now my doubt is will my profit margin be 150 (sell price) - 100 (futures buying price) = 50 or will it be 150 - 120 (spot price)... basically would request anyone here to clarify these implications owing to the price discount.
thanks a ton guys.
First of all thanks to this wonderful forum where I have learned so much.
I have a doubt in futures derivative. Have noticed that sometime the futures price say for example XYX stock, is at 100rs but the actually spot price is 120RS for the same,,, obviously at a discount.
Now I want to know what are the implications for this.
For example, even though the spot price is 120rs, I buy a contract lot for 100rs and later sell it for a higher price say 150rs... now my doubt is will my profit margin be 150 (sell price) - 100 (futures buying price) = 50 or will it be 150 - 120 (spot price)... basically would request anyone here to clarify these implications owing to the price discount.
thanks a ton guys.