Equity Derivatives as Risk Management Instruments: A Study of the Level of Satisfaction of the Investors

In India, the significance of capital market as a contributor for the growth of the economy is increasing day by day. The growth in global trade, technological advances and the market deregulations are the factors influencing this development. With the increasing awareness about the capital markets, a large chunk of investors are entering the markets to invest their funds and earn profits. But, as a by-product of this market, there is market volatility which is likely to cause the risk of loss to the investors. As a result there has been a corresponding increase in such financial products which enable the investors to minimise or hedge the various risks associated with the capital markets. Derivatives are the financial instruments which are widely used by the investors for this purpose. The study is an attempt to identify the strategies of risk management which the retail investors can use to minimise the risks associated with stock market investments.