About this course
Derivatives are one of the most powerful financial instruments in the stock market. Futures and Options (F&O) allow traders to profit in both rising and falling markets by using advanced strategies. Whether you are a beginner or an experienced trader, understanding derivatives can help you maximize your gains while managing risks effectively.
At Stock Uncle, our Derivatives Trading Course covers everything from the basics of Futures & Options to advanced strategies used by professional traders. By learning how to trade derivatives, you can:
- Leverage your capital to take larger positions with less investment.
- Hedge your portfolio to protect against market crashes.
- Trade like professionals using proven Options strategies.
- Identify market trends and profit in bullish, bearish, and sideways markets.
Why Learn Futures & Options (F&O)?
Many traders struggle in the stock market because they only focus on buying and selling stocks. However, professional traders and institutions use derivatives to manage risk and maximize profits.
- Trade in Rising and Falling Markets – Profit from both bullish and bearish trends.
- Leverage Your Capital – Control large positions with a small investment.
- Hedge Your Investments – Reduce losses by using options as insurance.
- Earn Passive Income – Use strategies like option selling and covered calls.
- Trade Like Professionals – Understand how institutions use F&O for smart trading.
What will you learn?
- Futures Trading – How contracts work, margin requirements, lot sizes, expiry, and hedging.
- Options Trading – Call & Put options, option pricing, Greeks, and premium calculations.
- Options Strategies – Covered calls, protective puts, iron condors, spreads, straddles, butterflies, and more.
- Market Analysis – How to identify bullish, bearish, and sideways markets.
- Trading Events & Results – How to trade during earnings, news events, and economic data releases.
1. Futures Trading – Understanding the Basics
Futures trading allows traders to buy or sell an asset at a fixed price for a future date. Unlike stocks, where you buy shares outright, futures trading uses contracts that represent a specific quantity of an asset.
How Futures Contracts Work
- Futures contracts are agreements between a buyer and a seller to trade an asset at a future date and price.
- They are available for stocks, indices, commodities, and currencies.
- Traders can go long (buy) or short (sell) based on market predictions.
Lot Size
- Futures contracts are traded in lots, which means you cannot buy just one share.
- Each contract has a fixed lot size (e.g., NIFTY 50 Futures have a lot size of 50).
- Understanding lot size helps in managing position sizing and risk.
Margin in Futures Trading
- Futures trading requires a margin, which is a percentage of the total contract value.
- Margin requirements vary based on volatility and market conditions.
- Traders must maintain a minimum margin balance to avoid liquidation.
Expiry of Futures Contracts
- Futures contracts have a fixed expiry date (e.g., the last Thursday of each month for index futures).
- On expiry, traders can either roll over their contracts or settle in cash.
Hedging with Futures
- Hedging is a strategy used by investors to protect their portfolios from market crashes.
- Institutions and traders use futures contracts to hedge risks in stocks and commodities.
- Hedging helps in minimizing losses during market downturns.
2. Options Trading – Understanding Calls & Puts
Options are derivative contracts that give traders the right (but not the obligation) to buy or sell an asset at a predetermined price before expiry.
Types of Options
- Call Option – Gives the right to buy an asset at a fixed price.
- Put Option – Gives the right to sell an asset at a fixed price.
3. Options Buying – Key Concepts
Options buying involves purchasing financial contracts that give the right, but not the obligation, to buy (Call Option) or sell (Put Option) an underlying asset at a set strike price before the expiration date. Buyers pay a premium for this right, which is influenced by factors like time, volatility, and the asset's price.
Greeks in Options Trading
Options pricing is influenced by various factors called "Greeks":
- Delta – Measures the change in option price relative to stock price movements.
- Theta – Measures the effect of time decay on option prices.
- Vega – Measures the impact of volatility on option pricing.
- Rho – Measures how interest rate changes affect options prices.
- Gamma – Measures how Delta changes when the stock price moves.
Option Chain Analysis
- Understanding the option chain helps traders pick the best strike prices.
- It includes Open Interest (OI), volume, and bid-ask spreads.
Premium & Strike Price
- Premium is the cost of buying an option.
- Strike Price is the price at which the contract can be exercised.
4. Options Strategies – Advanced Trading Techniques
To maximize profits and manage risks, traders use advanced strategies in options trading.
Covered Calls
- Selling a call option while holding the stock to generate income.
Protective Puts
- Buying a put option to hedge against stock price drops.
Iron Condors
- Combining calls and puts to profit in low-volatility markets.
Spreads (Debit & Credit Spreads)
- Using multiple strike prices to limit risk while earning steady profits.
Straddles & Strangles
- Buying both call and put options to profit from big price movements.
Butterfly & Iron Fly
- Advanced options strategies used for range-bound markets.
5. Trading During Events & Earnings
- Market events like earnings reports, economic data, and news impact stock prices.
- Traders use event-driven trading strategies to profit from price swings.
- Understanding implied volatility (IV) crush helps in planning trades around major events.
4. How to Identify Market Trends
To trade effectively in F&O, you must identify market trends.
Bullish Market (Uptrend)
- Price makes higher highs and higher lows.
- Best strategies: Buying Calls, Bullish Spreads, Covered Calls.
Bearish Market (Downtrend)
- Price makes lower highs and lower lows.
- Best strategies: Buying Puts, Bearish Spreads, Protective Puts.
Sideways Market (Range-bound Trading)
- Price moves within a fixed range with no clear trend.
- Best strategies: Iron Condors, Butterflies, Credit Spreads.
Who Should Take This Course?
- Beginners who want to learn Futures & Options from scratch.
- Stock market traders who want to hedge risks and boost profits.
- Investors looking for passive income through options selling.
- Traders who want to apply Smart Money Concepts to derivatives trading.
- Anyone who wants to trade F&O with confidence and proper risk management.
Benefits of Learning Futures & Options (F&O) Trading
- Profit in Any Market Condition – Trade in bullish, bearish, and sideways markets.
- Leverage Small Capital for Bigger Returns – Use margin effectively.
- Advanced Risk Management – Use options strategies to minimize losses.
- Passive Income with Options Selling – Make money without stock ownership.
- Hedge Investments – Protect long-term portfolios from market crashes.
- Trade with Confidence – Understand how professionals trade derivatives.
Derivatives (Futures & Options)
