Difference between Cash and Future Market

No image Prasanth Menon

Last Updated: 7th September 2023 - 05:01 pm

Listen icon
BASIS FOR COMPARISON CASH MARKET FUTURE MARKET
Meaning A place where financial instruments are traded, wherein the delivery of stock takes place. Future market is a place where only future contracts are bought and sold at an agreed date in the future and at a predefined price.
Ownership When you buy shares and take delivery, you become shareholder of the company till you hold the shares. You can never be a shareholder when you trade in Futures.
Delivery It is done on T+2 days. No delivery takes place as the Future contract expires on expiration date.
Payment Full amount needs to be paid at the time of buying shares in cash. Only margin money requires to be paid for initiating Future contract.
Lot size One can buy even single share of company. One has to buy a minimum lot size which is already defined. Such as in case of NIFTY lot size is 75.
Holding period In cash market you can buy shares and hold for life. In futures, you have to settle the contract on the expiration date i.e. maximum of three month.
Dividends When you are shareholder of the company, you are entitled to receive dividend. In future contract you are not entitle for any dividend.
Objectives People buy shares in cash market for investment purpose Futures can be traded for Arbitrage, hedging or speculation purpose.

 

FREE Trading & Demat Account
Open FREE Demat Account with endless opportunities.
  • Flat ₹20 Brokerage
  • Next-gen Trading
  • Advance Charting
  • Actionable Ideas
+91
''
 
By proceeding, you agree to our T&Cs*
Mobile No. belongs to
hero_form

Indian Stock Market Related Articles

List Of Maharatna Companies In India

by Tanushree Jaiswal 9th Jul 2024

Why Quant Mutual Funds Are Outperforming?

by Tanushree Jaiswal 5th Jul 2024

NSE's 90% Cap on SME IPO Listing Prices

by Tanushree Jaiswal 5th Jul 2024

Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing. For detailed disclaimer please Click here.

Open Free Demat Account

Be a part of 5paisa community - The first listed discount broker of India.

+91

By proceeding, you agree to all T&C*

footer_form