Trading Preferences of Equity Derivative Traders in Kerala
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Abstract
The trading preferences of equity derivative traders has been examined in this study. The examination of objectives and preferences of equity derivative traders shows that earning speculative profit is the most preferred trading objective of derivatives traders, and the options market, index options and intra-day trade are the most preferred; market, instrument and trade respectively. Most of the options traders are showing interest in weekly expiring contracts and ATM options along with different market-based strategies while trading in the options market. Among 300 respondents, more than one-third of traders, square off their position when the market moves adversely without waiting for stop-loss, whereas a small majority reported that they modify their strategies in the event of adverse movement in the market.