Futures Trading
Never traded a contract before? Start right here. A modern, visual, beginner-first course that takes you from “what is a future?” to margin, mark-to-market, the payoff, rollover and hedging - explained in plain English with real Indian market examples, and honest about the leverage that makes futures powerful and dangerous in equal measure.
Why this course?
Most futures material jumps straight to strategy and assumes you already know what margin, basis and rollover mean. This one does not. Written for absolute beginners, it builds the idea of a futures contract from the ground up, uses real Indian lot sizes and prices, and is honest about the single most important fact in futures: leverage cuts both ways. The goal is to make you understand exactly what one contract controls and what it can do to your account - so you can make your own informed decisions.
What a Future Is
What a futures contract is, how it differs from forwards, options and shares, and why it exists.
What Is a Futures Contract?
A future is simply an agreement to buy or sell something at a fixed price on a future date. Learn what that means in plain words, with a real Indian example, before any jargon arrives.
Futures vs Forwards, Options and Shares
A future is not a forward, not an option, and not a share. Learn how a standardised exchange-traded future differs from a private forward, why a future is an obligation while an option is a right, and why holding a future is not the same as owning the stock.
Why Futures Exist: Hedgers and Speculators
Futures were not invented for gambling. Meet the two crowds that meet in the futures market, the hedger who wants to remove risk and the speculator who is happy to take it on.
Reading a Contract: Lot Size, Expiry and Tick
Every future is standardised. Learn the lot size (NIFTY 65, BANKNIFTY 30, RELIANCE 500), the monthly expiry, the tick size and the symbol format, so you know exactly what one contract controls.
Trading Mechanics
How orders work, liquidity and slippage, and the linear payoff of going long or short.
How Futures Orders Actually Work
Before you trade, you need to place an order correctly. Learn the order types (market, limit, stop-loss and stop-loss market), the product types (intraday versus carry-forward), how a square-off works, and the order mistakes that catch beginners.
Liquidity, the Bid-Ask Spread and Slippage
The last traded price can mislead you. Learn the bid, the ask and the spread you actually trade against, what slippage and impact cost mean, and why a far-month or thin stock future can cost far more to enter and exit than the screen suggests.
Going Long and Going Short
Futures let you profit from a fall as easily as a rise. Learn what going long and going short mean, and why selling first is normal and not exotic in the futures market.
The Futures Payoff: A Straight Line
Unlike options, a future has the simplest payoff there is, a straight line. Learn to read the long and short futures payoff on a real RELIANCE example, including why the loss can be as large as the gain.
Margin and Money
Margin and leverage, SPAN and pledged collateral, daily settlement, and what trading costs.
Margin and Leverage: The Double-Edged Sword
You do not pay the full contract value, only a margin. That is leverage, and it multiplies both gains and losses. Learn how margin works and why leverage is the single most important risk in futures.
SPAN Margin, Exposure and Pledged Collateral
Margin is not a fixed number. Learn how it is built from SPAN plus exposure, why it rises when volatility rises, what peak-margin rules mean, and how Indian traders pledge holdings as collateral, including why margin available is not the same as free cash.
Mark-to-Market: Settled Every Single Day
A futures position is settled in cash at the end of every trading day, not just at expiry. Learn how mark-to-market moves money in and out of your account daily and why a losing position can be closed for you.
Transaction Costs and Taxation
A future looks cheap to trade until you add the costs and the tax. Learn the full stack of charges, brokerage, STT, exchange fees, GST and stamp duty, how they move your breakeven, and the basics of how futures profit is taxed as business income.
Pricing and the Cycle
How a future is priced versus spot, the contract cycle, rollover, calendar spreads and basis.
Basis and the Cost of Carry
A future rarely trades at exactly the spot price. Learn the basis (the gap between future and spot) and the cost of carry that explains it, plus what a premium or discount is telling you.
The Expiry Calendar and Contract Cycle
At any moment, three monthly contracts trade at once. Learn the near, next and far month, the monthly cycle and expiry day, how to choose which contract to trade, and why a beginner should avoid the thin far-month contract.
Rollover: Moving to the Next Month
Futures expire, but a view can outlast a month. Learn rollover, the act of closing the expiring contract and opening the next one, and what high rollover tells you about market sentiment.
Roll Spreads, Calendar Spreads and Basis Trading
The gap between two months and the gap between future and spot can themselves be traded. Learn the roll spread you pay at rollover, the calendar spread as a position, and the idea of cash-futures arbitrage, which you should understand but not blindly attempt.
Settlement and Positioning
Physical versus cash settlement, index versus stock futures, and reading open interest.
Settlement: Stock Delivery vs Index Cash
What happens at expiry depends on what you traded. Learn that stock futures are physically settled (an open position can become an actual delivery obligation, with short-delivery risk), while index futures settle in cash, and why a beginner should square off stock futures before expiry.
Index Futures vs Stock Futures
NIFTY and BANKNIFTY futures behave differently from a single stock's future. Learn the practical differences in liquidity, risk and use, and why beginners usually start with the index.
Open Interest in Futures
Open interest is the most quoted and most misread number in futures. Learn what OI actually means, how to read a long or short build-up versus an unwinding or covering, volume versus OI, and why OI is not a guaranteed prediction signal.
Market Controls and Adjustments
The exchange rules that shape what you can trade: position limits and the ban, corporate-action adjustments, and the price bands and halts that bound every session.
Position Limits, the F&O Ban and Quantity Freeze
The exchange caps how much of a contract anyone can hold. Learn the market-wide position limit, the client and member limits, what tips a stock into the F&O ban period and the rule that you can take no fresh positions while it lasts, and the quantity freeze that forces a large order to be sliced.
Corporate Actions and F&O Adjustments
When a company splits its stock, issues a bonus or pays a special dividend, its futures and options are adjusted so open positions keep their value. Learn how a split or bonus changes the lot size and strike, how the adjustment factor works, the special-dividend threshold that triggers a change, and how rights and mergers are handled.
Price Bands, Circuits and Trading Halts
A contract is not free to move any distance in a day. Learn the operating ranges and price bands that bound a future, why an order can be rejected for breaching them, how index circuit breakers halt the whole market, and how these controls change your risk and your ability to get out.
Risk and Discipline
Hedging in practice, position sizing, gap and event risk, and the mistakes to avoid.
Hedging a Portfolio: Worked Examples
The original job of a future. Learn how shorting an index future protects a portfolio, with worked cases: a full hedge, a partial hedge, a high-beta portfolio, and what happens when the hedge size is wrong.
Position Sizing with Futures
The fastest way to blow up is to trade too large. Learn how to size a futures position from your capital and your risk per trade, the stop-distance times lot-size method, the difference between intraday and positional sizing, and why many accounts are simply too small for futures.
Gap Risk and Event Risk
Leverage is most dangerous when the market jumps. Learn why an overnight gap can blow past your stop, the events that cause it, results, RBI policy, the Budget, elections and global news, and why a stop-loss is not a guarantee in a leveraged position.
The Risks of Leverage (and How to Survive)
Most futures traders lose, and leverage is usually why. Learn the honest risks, the margin-call spiral and the overnight move, and the discipline that keeps a trader in the game.
Beginner Mistakes and Your Futures Checklist
Close the course with the mistakes that ruin beginners and a checklist to avoid them. Trading too large, holding stock futures into expiry, ignoring liquidity, averaging leveraged losses, and treating margin as the most you can lose, then a clear pre-trade checklist.
For education only - not investment advice. 27 chapters, built on real Indian market examples for beginners.