Derivatives, Futures & Options

‘Risk’ is an inseparable part of investing in financial and capital markets. Every instrument that is available in these markets comes with a risk tag attached to it. To some investors, ‘high risk’ is attractive since it is usually associated with good returns. To others ‘high risk’ spells danger as it could result in loss of capital. It is the existence of risk in investing coupled with different investor risk profiles and perceptions that has given birth to the market for derivative products.