Why would someone buy bike insurance without owning a bike, or car insurance without owning a car?
Options and futures were designed as hedging instruments —similar to insurance for an existing stock portfolio.
Yet many people trade options without holding any underlying stocks.
Isn’t this closer to speculation than hedging?
Brokers and the government make money whether traders win or lose
(brokerage, STT, taxes), and profits are taxed again.
For most retail investors, does this setup really make sense?
Wouldn’t buying fundamentally strong stocks and holding themfor 5–10 years for organic growth be a safer and more practical approach
than actively trading options and futures?
Looking forward to hearing different perspectives,
especially from people who trade derivatives successfully.