I have Niftybees (ETF) in my account and want to protect the downside fall by Buying the put option ; do we have any yearly based put option or PUT ETF in the NSE ?
Regards
Why put option, as you have bought a delivery product?
Yes, probably nifty may go down to 9k, 8k or 7k, in that case isn’t a good chance to buy more of what you have already bought?
Nifty/Nifty bees cagr is about 10-11% only. You will reduce your returns by buying puts, Incase markets don’t fall or puts didn’t perform in a range bound market.
If you have good quantity for Nifty Bees say around 6-7 lakhs… buying Dec 2019 PUT at ATM strike makes sense as hedge… 2019 being a volatile year …Better to hedge NiftyBees. Dec 2019 PUT should be available at 4-5%
Insurance is always better. Year like 2008 would wipe out comeplely without insurance.
Say 2019 is becomes very favourably say +20% to 30 %,. Your returns would be reduced by just value lost in premium of PUT say 4-5%. Think if Nifty is down 40- 50 % , Put insurance will save you …Max loss would be just 4-5 %.
Always better to Hedgeđź‘Ť if portfolio is large.
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Put option will not work out, which month market falls who knows
You should have a good idea of market, then you can easily handle your Nifty positions
Better to be on Nifty future short it will hedge better
Why @rj07 ? Should we invest more and more into loss making falling knife and lose more money in eating machines?
@ManoranjanS please guide in any possible hedging for 1 lac capital ? Will equity intraday shorting work in volatile days?
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I don’t think it is good idea to hedge NiftyBees with intraday positions…It won’t serve any hedge in turn might result in more losses.
No not niftybees individual stocks pls guide
For intraday individual stocks no Hedge is required … You need to have proper stop loss as per your risk using BO CO order.
For long term blue chips your you could also use Covered call…Again for larger position only. Or buy put
Hi bro,
My self planned to buy 5k Nifty bees this month.
Please guide me what exactly I should do for protecting my capital.
Is it good to sell one step down CE strike price of next month or going forward to buy PE of Dec month.
Regards
you can use nifty bees to pocket monthly future premium by shorting future. this profit strategy is mainly used by HNI because it needs extra cash to cover future mtm as future is settled everyday. you can pocket 100-150 points in nifty every month.