Hedging Future with deep In The Money options

Please help me with this hedging strategy which show very limited loss with unlimited profit when I checked this strategy in sensibull and opstra.

Today’s Date 17/01/2019
Expiry Date 31/01/2019
Spot price 10912
Future price 10935

I want to sell NIFTY Future at 10935
I want to buy a deep ITM call option of 10500 at 444.4

This strategy shows me that I am getting max loss of 638 and max profit unlimited below 10500.

Is this strategy possible or is anything wrong with this strategy?

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@a.b.singh True, but in PAYOFF graph profit starts below 10500 at exp.
try to exit before expiry as call theta erode premium.
watch MTM profit.


1 Like