Futures Contracts also have their own price lists. Investors (investors) will base their expectations on the index's increase or decrease to place orders and match trading orders. Investors who expect the index to rise will buy index futures, on the contrary, investors will sell index futures if they expect the index to fall.

Difference between Stocks & Derivatives

Difference between Stocks & Derivatives

Accordingly, the first difference of futures contract transactions is "maturity", so when trading contracts, investors should pay attention to choose a contract with a maturity month in line with the investment plan.

The second difference, if investors want to buy shares on the underlying market, they need to have enough money before trading, in futures contracts, they do not. Investors do not need to have the full amount to participate in buying or do not need to hold an account to participate in the sale. With this difference, investors come to the new concept of "Margin".

Margin in derivatives trading acts as a deposit to ensure the performance of obligations of both parties when entering into a contract. The initial margin rate for each type of contract is different and is regulated by the Depository Center. In case investors do not have enough deposit amount as required, they may be called to deposit and investors will have to complete the deposit to continue keeping the contract.

Another difference of derivatives is the daily settlement mechanism. When trading contracts, investors must pay all profits and losses every day.

• If the derivative securities account has a net loss: Investors will need to pay in full all losses incurred by 9 am of the next day.
• If the investor's derivative securities account makes a net profit: the investor will receive the full amount of profit after 11 am of the next day.

Are Derivatives Investments Guaranteed?

Although very "attractive" with its flexible operation mechanism and product diversity, the differences of CKPS still make F0 investors doubt whether CKPS is really guaranteed? Many investors reasoned that the “future” element made the product more like a risk bet and potentially more risky than a regular stock investment.

The answer is that investors can be completely assured when investing in CKPS products. In fact, investors should also note that any securities product has potential risks, not only CKPS. Investors can limit them by cultivating new knowledge and consulting analytical reports from securities companies, reputable news sites. Besides the risks, investors also need to look at the advantages of CKPS to see the potential of this very investment-worthy product, including:

Hedging against price fluctuations: If investors predict that the price of an underlying asset will increase or decrease in the future, they will minimize the risk of price fluctuations by buying or selling the commodity at the current price. thanks to the futures contract.
Short-selling securities: Investors can sell derivatives even without the underlying asset.
High liquidity: Derivatives have high liquidity because they are listed and traded centrally on the Stock Exchange.
Financial leverage benefits: Investors only need to deposit a part of the assets but can trade with shares worth many times the amount of the margin, providing an investment advantage.
Join trading PHS Derivatives now:

Investors should note that experts in the financial sector recommend that CKPS be more suitable for investors who have had a lot of "real combat" experience. However, F0 investors should also learn and approach this financial instrument now to be ready for "attractive" investment plans in the future.