What is the difference between futures and cash markets?
FUTURE MARKET - A future market is a place where only futures contracts are bought and sold at an agreed date in the future and at a predefined price. You can never be a shareholder when you trade in Futures. No delivery takes place as the Future contract expires on the expiration date.
Only margin money required to be paid for initiating the Future contract. One has to buy a minimum lot size which is already defined. Such as in the case of NIFTY lot size is 75. In futures, you have to settle the contract on the expiration date i.e. maximum of three months.
In a future contract, you are not entitled to any dividend
CASH MARKET - A cash market is a marketplace in which securities purchased are paid for and received at the point of sale. For example, a stock exchange is a cash market because investors receive shares immediately in exchange for cash.
Demat settlement of T+1 days takes place on account for bought holding and the client becomes a shareholder of a stock company. It is done on T+1 days.
The full amount needs to be paid at the time of buying shares in cash. One can buy even a single share of a company.