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If an investor need to purchase Dec put choices (yearly expiry) as a hedge, can he offset his loss from the revenue in fairness?
Eg:
An individual buys 1 crore value of Nifty Index ETF.To hedge he additionally buys round 5 lakhs value of Nifty Put choices (Dec expiry)
After 10 months, he earns a revenue of 20 lakhs from Nifty Index ETF.However he suffers a lack of 4 lakhs in his Put (attributable to time decay) that he has purchased as an insurance coverage.
His web revenue is 16 Lakhs.
My query is, since F&O is taken into account enterprise revenue and Fairness comes below STCG, or LTCG, how can he offset his loss? Is it even doable?
@Quicko @Jason_Castelino
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