CASH & CREDIT

There is a remarkable increase in leverage position from retail investor which is always a danger sign, F&O Future & Option has unique advantage and disadvantage and which small investor can never make use of due to many limitations. 1) Investor should understand F&O is time bound 1month-2month-3month so this make it very simple one person loss is other person gain. 2)But in my experience the gains goes to arbitrage funds who benefit from cost of carry and few market intermediaries but the loss is suffered mainly by investor 3) How? Investors buy in F&O because they have limitation of funds so they like to maximize the profit with minimum investment but in reality this can never happen 4) why? Markets never move one side up or down it moves up & down so on a daily basis there is always mark to margin over and above u r initial margin suddenly the stock loses 8-10% which means big chunk of money goes in paying mark to market margin and a fear builds in as F&O position is taken due to limitation in fund end when he sees 3-4% more drop he is unable to bear the pain and sell in panic and all is capital gets eroded. Conclusion one who buys in cash can relax and one who buys on credit is always tensed profit is made only when u can bear the pain of markets and it can happen only when u can limit u r risk.