Why and How to Trade in NIFTY Futures-converted
                     Why and How to Trade in NIFTY Futures
Hello friends, are you having any kind of problem about NIFTY then i am here  
to solve your problems related to the topic of share market in this blog we are  
going to study in a brief about Nifty Futures and why and how to trade in Nifty  
Futures. Let's start our topic by knowing in a brief about Nifty Futures.
About Nifty futures
It is basically some index futures where the underlying is the S&P CNX Nifty  
index. In a country like India, index futures trading started in 2000 on the  
National Stock Exchange.
Nifty futures has contracts of 50 stocks, Nifty futures contracts have a three-  
month trading cycle also and those are , the near month, the next month and  
the far month.
When the near month contract expired, a new contract of a three month  
duration is introduced on the next trading day. Investors can easily trade in  
Nifty futures by having a minimum amount in their account. The minimum  
amount should be a percentage of the contract value.
Why we should trade in Nifty Futures?
Here are some of the main things that i am going to tell about which gives  
advantages in trading in Nifty Futures.
Short stock, long index futures
Sometimes when you sell your stock, but the market is upside at that time,  
thus in result you have to face lost potential profits. Index futures help you to  
reduce this risk. By buying index futures when you are lack of the stock, you  
can reduce the amount to minimum of potential profits lost.
Equity portfolio, short index futures.
Few times when you own a portfolio and feeling uncomfortable about the  
condition of market. You can decrease the risk by selling index futures. The  
concept based on the fact that each portfolio has their index exposure and so  
risks are accounted for by unstable in the index.
Long Stock, Short Index Futures
Suppose you have 500 shares of Reliance Industries at the price of Rs 1,000  
per share, Nifty is at 5,000 and Nifty futures is at 5,020.
To save your Rs 5 lakh (Rs 5,00,000) position from the market downturn, you  
will have to sell your 100 Nifty futures. Suppose on the date of expiry, the  
Nifty Futures is at 4,750 (fall of 5 percent). When both the position will close,  
you will earn Rs 2,000.
Short Stock, Long Index Futures
Suppose you are facing the lack of 400 shares of Infosys Technologies at a  
price of Rs 2,500 for each share, Nifty is at 5,000 and Nifty futures is at 5,050.
To save your money Rs 10 lakh (Rs 1 million) position from the downturn of  
market, you will have to buy about 200 Nifty futures. If, on the date expiry,  
Nifty futures is at 5,250 (Rise of 5 percent), When both the position will close  
you don't have to face any kind of loss.
These are some of the basic and necessary things you should know about Nifty  
and Nifty futures if you are newly entering into the market.
I hope, my above mentioned things will help you a lot to understand about  
Nifty and Nifty futures.