INVESTOR’S PERCEPTION

TOWARDS DERIVATIVES
MARKETS
 DERIVATIVES MARKET
• A derivative is a product whose value is derived from the value of one
or more underlying variables or assets in a contractual manner. The
underlying asset can be equity, forex, commodity or any other asset.

• The main logic behind derivatives trading is that derivatives reduce the
risk by providing an additional channel to invest with lower trading cost
and it facilitates the investors to extend their settlement through the
future contracts. It provides extra liquidity in the stock market.
 MYTHS BEHIND DERIVATIVES?
• Derivatives increase speculation and do not serve any economic purpose.
• Indian Market is not ready for derivative trading.
• Disasters prove that derivatives are very risky and highly leveraged
instruments.
• Derivatives are complex and exotic instruments that Indian investors will
find difficulty in understanding.
• Is the existing capital market safer than Derivatives?
TYPES OF DERIVATIVES
INVESTOR’S PERCEPTION TOWARDS
DERIVATIVES MARKET

• PRICE VOLATILITY
• GLOBALISATION OF MARKETS
• TECHNOLOGICAL ADVANCES
• ADVANCES IN FINANCIAL THEORIES
WHY TO USE DERIVATIVES?

• RISK MANAGEMENT
• PRICE DISCOVERY
• OPERATIONAL ADVANTAGES
• MARKET EFFICIENCY
• EASE OF SPECULATION
RESEARCH DESIGN AND METHODOLOGY
Research methodology is a way to systematically solve the research
problem. It is a science of studying how research is done scientifically.
It includes:
• Research Design
• Data Collection
• Data Analysis
RESEARCH DESIGN:
Descriptive Research has been used, which involves surveys and fact
findings of different kinds.
THANK YOU
-SHAISTA NAHID
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