Origins of Options
Options have been used since ancient times. The first
historical transaction in options was done by the ancient greek
mathematician and philosopher - Thales of Miletus, who
exercised 'option' (a right) to rent out a certain number of
olives at a much higher price than the initial purchase price.
Exchange traded options started in 1973 as a part of
the financial instrument class. Today, over-the-counter options
like bilateral, customised contracts between a single buyer and
seller are in existence as well. However, this being the first
time that options are introduced in the Indian commodities
What are Options?
Commodity option is a financial derivative instrument
better suited for risk-averse groups like farmers as there is
no margin calls for buying options. It is a beneficial tool to
hedge and speculate by limiting the risk factors. Options, when
used along with the spot and futures can help develop an
efficient risk management strategy for various market
Options - Is it your cup of tea?
Options are not at all intimidating as they may sound. Rather,
they are easy to understand.
The NICR's Options
Certification Course will help you learn options in a simple
and easy way.
What will you learn in the NICR's
Options Certification Course?
non-profit educational institution dedicated to promoting
research and awareness in the commodity market runs the Options
Certification Course encompassing following three modules:
□ Module 1: Beginners
- A beginner's module, designed to impart
basic know how on options – meaning, utility and practical use
- Understand basic options terminologies.
- Understand how options are different
from futures and their payoff profile.
- Understand the intuition behind pricing
of options using simple analogies.
- Basic understanding of realised
volatility, implied volatility and the Black Scholes Model.
□ Module 2: NCDEX
- This being a NCDEX specific module, it
covers options from NCDEX perspective, covering aspects of
margins, expiry, position limits, price limits and advanced
- Volatility based trading strategies that
are useful in managing options portfolios.
□ Module 3: Advanced
- This being the module for students who
have some basic understanding on options.
- Understand risk factors in options
(sensitivities or option Greeks).
- Understand different strategies to lower
the risk and earn profit.
- Learn about volatility smiles, skews and
management of options positions during expiry (including CTT