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Understanding Futures Contracts and Margin Trading

An advanced, mechanics-first course on futures contracts and leveraged trading for experienced retail investors, active traders, and HNIs who already know what a futures contract is. Covers contract specifications, cost of carry and basis, open interest and rollover, the full NSE Clearing margin stack (SPAN, exposure, mark-to-market, peak margin, shortfall penalties), broker square-off rules, Margin Trading Facility (MTF) and pledging, directional and hedging strategies with Nifty and stock futures, calendar spreads, cash-futures arbitrage, physical settlement, MWPL ban periods, and the taxation of F&O income in India. Built around live NSE contract data, SEBI circulars, and Zerodha-style broker mechanics.

Futures PricingSPAN MarginMark-to-MarketMargin Trading FacilityHedging with FuturesRolloverPhysical SettlementF&O Taxation

MODULES

5

DURATION

~3.3 hrs

TRACK

Options & Derivatives

What You'll Master

Read any NSE futures contract specification and compute fair value from the cost of carry

Explain exactly how SPAN, exposure, and peak margins are computed and why margin calls happen

Use Margin Trading Facility and pledging correctly, and compute the true cost of leverage

Hedge a stock portfolio with Nifty futures using beta-weighted hedge ratios

Run calendar spreads, rollovers, and cash-futures arbitrage with realistic costs

Handle physical settlement, MWPL ban periods, and file F&O income correctly

Access Level

LEARNER

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Everything included

Full Text Playbooks

Actionable Exercises

Mobile Reading Mode

Lifetime Updates

Curriculum Breakdown

Futures Contract Anatomy: Beyond the Basics

4 Lessons

Reading a Contract Specification: Lot Size, Tick Size, Expiry, and Settlement9 min read

Cost of Carry and Fair Value: Why Futures Trade at a Premium or Discount10 min read

Basis, Contango, and Backwardation: What the Spread Tells You9 min read

Open Interest, Rollover, and Reading NSE Futures Data10 min read

The Margin System Under the Hood

4 Lessons

SPAN and Exposure Margin: How NSE Clearing Sizes Your Risk11 min read

Mark-to-Market Settlement: The Daily Cash Flow You Cannot Ignore10 min read

Peak Margin, Shortfall Penalties, and SEBI's Rulebook10 min read

Margin Calls and Broker Square-Off: How Positions Get Liquidated9 min read

Margin Trading Facility and Collateral

4 Lessons

Margin Trading Facility Explained: Borrowing from Your Broker to Buy Delivery Stocks10 min read

Pledging, Haircuts, and Collateral: Funding Margins Without Cash10 min read

The Real Cost of Leverage: Interest, Holding Periods, and Breakeven10 min read

MTF vs Stock Futures: Choosing the Right Leverage Tool9 min read

Trading and Hedging Strategies with Futures

4 Lessons

Directional Trading with Index Futures: Position Sizing and Risk Limits10 min read

Hedging a Portfolio with Nifty Futures: Beta-Weighted Hedge Ratios11 min read

Calendar Spreads and Rollover Strategies10 min read

Cash-Futures Arbitrage and Reverse Arbitrage in Practice10 min read

Settlement, Regulation, and Taxation

4 Lessons

Physical Settlement of Stock Futures: What Happens If You Hold to Expiry10 min read

Position Limits, MWPL, and the Ban Period9 min read

Taxation of Futures Trading: Business Income, Turnover, and Audit11 min read

Survival Rules for Leveraged Traders: Lessons from Real Blow-Ups10 min read