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Management Insight

INDIAN FUTURES MARKET : AN ANALYSIS
Agha Nuruzzaman*

ABSTRACT
The Indian government’s efforts are directed towards the establishment of a free, fair, transparent and fully informed market with help of the Futures market, so that futures prices are truly determined by the forces of demand and supply.
In the long term, the continuing rapid growth of economy in India creates a huge potential for Futures market. This study is an effort to understand the factors under PEST Analysis. For this purpose, data from different sources were collected and later analyzed by using statistical techniques. With an improving agriculture, widening scope of education, a balanced economy, friendlier infrastructure, vividly sketched out laws unstained by any kind of corruption will create the right climate for swift growth of the futures market. The PEST analysis shows that most of the factors considered are indeed going in favour of India’s futures market.

INTRODUCTION
A futures contract is a legally binding agreement to buy or sell a commodity or financial instrument sometime in the future at a price agreed upon at the time of the trade.
While actual physical delivery of the underlying assets seldom takes place, futures contracts are nonetheless standardized according to delivery specifications, including the quality, quantity, and time and location.
The only variable is price, which is discovered through the trading process. In this study we are trying to find out the opportunities and challenges of futures trading in India through
PEST analysis.
One of the key benefits of trading in the futures markets is that it offers the trader financial leverage, which is the ability of a trader to control large Dollar/Rupee amounts of a commodity with a comparatively small amount of capital. As such, leverage magnifies both gains and...

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