What are Futures and Options?
The fundamental difference that separates futures and options from each other lies in the obligation that is put on the sellers and buyers. With options the buyer obtains the right but he is not obligated to sell or buy any assets at any price or any time during the lifetime of the contract.
On the other hand, with futures the buyer is obligated to purchase a certain assets at a specified time and date. The seller too has to sell and deliver the specified asset at a specified future date.
A futures contract can be entered by an investor without having any upfront costs while in case of option, the position requires the payment of some premium beforehand.
Although, the upfront costs are not missing in the options, but that payment can be seen as a way or a fee paid to obtain the privilege of not carrying any obligation for buying or selling anything if any adverse changes take place any time in the prices. The premium amount paid is the maximum amount that the investor of options stand to lose; nothing more than that.
Now, there is an easy way to invest in futures and options using only a smartphone. Clone Algo app by Clone Algo Inc. allows everyone to invest in their preferred investment vehicle including options and futures. This mobile app is available for both the platforms Android as well as iOS (iPhone).
The app can be downloaded at: