Financial markets in India have undergone significant changes over the last several years. The entry of derivatives into different segments of the Indian market is one such example of change. Derivatives are widely recognized as risk management tools. Risk management is an integral part of corporate planning. It continues to grow in importance and complexity. The introduction of derivatives in the Indian capital market is the beginning of a new era. Indian derivatives market has turned to be a multi-product derivatives market, at par with the global standards. Derivative products have a long history in India in the unorganized sector, especially in currency and commodity market. At present the Indian market trades in both exchange traded and over the counter derivatives on various classes of assets. However, the text book focuses on exchange traded financial derivative products i.e. futures and options.