Taking current Nifty value as a base, If suppose I want to short 10 Lots of Nifty CE on a monthly basis (3 strikes away from spot) at the time of execution of trade, how much quantity of NiftyBees should I have in my portfolio so that it can fall under Covered Call ? Would be great if this is answered with the help of calculation. Thanks
1 lot of Nifty is 75 nifty of value 8000 (assume nifty is at 8000). So 10 lots will be 750 nifty of value 8000 = 750*8000 = 60 lks.
So you will need 60lks worth of Nifty Bees in your portfolio. If Nifty bees is at 800 (1/10th of actual nifty), you will need 6000 shares.