Future and Options always Operators Favourite

The Stock market is gambling in India?

Many traders say that the trading in the stock market and the commodity market is operated by big traders so that only they are not able to a make profit and some traders say that the market is a gambling so no one could win in the market. Whatever might be the traders who made losses in the market might gambled in the market, that’s why they use the term gambling. Wherever there is a huge flow of money and where there is a trading which involves heavy loss and profit called as gambling. An investor should expect a reasonable profit for the amount he is investing, which is a business and if they expect more, than it is a gamble. So everything depends upon the view. If you watch the stock market as a business, then it is a business as if you watch as gambling then it is a gamble.

Why future and options trade in market? FII

The future and option are a hedging product. This is operated for large investors. The future is traded for assessing the future prospects of the assets of the huge investors or for deciding the price of the hefty asset they are planning to buy. This is not advisable for small investors. Same way for the insurance of future and asset, the option will trade. The future and option has been introduced to the heavy investors and not for the small investors. So small traders should be very careful while trading in future and option.

Who is the operator in the stock market in India?

Share market can be divided into small investors and big investors. The big investors will not allow the small investors to earn more profit. This not only applies to the stock market but to all business. When the big investors invest a hefty amount to the index or stock trading speed will be more. If they are buying one share in a huge amount then the price of the share will shoot up and if they are selling the share then the price of that share will come down quickly. During this the small investors will be confused and they will say the big investors are operating the market. The traders who have the capacity to buy more and sell more is called the market operators. Once the word operator is said in everyone’s mind will be thinking of FII (Foreign Institutional Investor). They are the one who is making profits on the investments made by the smaller investors.

How to earn operator in the stock market?

By making hefty investment the operators are gaining profit easily. When buying a share of a company in large quantity a big investor will also buy that share if it trades in future. Also, they will buy the call option of that share. If that share rises up 10% the hefty trader will gain 10% in equity and 10% in the future and 10% in option. So the operator decides the rise and fall of the share. The operator has many ways to make the profit.

When a particular index or stock that has large quantity of buying or selling the small investors trading in the opposite direction of the market will face losses. This is why most market pundits say go along with the direction of the market. Tips provider will earn money in this way. Some tips provider will give recommends to the traders by saying an operator call to make the traders believe them.

What is the “falling knife” in the market?

An index or a stock continuously on the down line called “Falling Knife”. Falling knife means a term to notify not to buy that stock. A knife which is in stable position will not harm you whereas a knife which is falling and if you try to catch that surely it will harm you. This applies to all the stocks that break life low.

Updated: March 31, 2015 — 11:51 am
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