BQLearning - F&O Series: Premium and Discount in Futures  

BQLearning is a special show that seeks to demystify financial markets, economic theories, legal processes and political structures.

In this series we explain how the most commonly used derivatives - futures and options, work in equity markets, the advantages they offer and the risks associated with them.

The price at which a futures contract trades is invariably different from the price of its its underlying asset in the cash market. It’s often higher than the spot, but it sometimes trades lower too.

In this video, Amit Shah, technical and derivatives analyst of BOB Capital Markets explains the reason behind the difference.