Ram buys 10000 shares of X Ltd at Rs 22 and obtain complete hedging of shorting 400 Nifties @ Rs 1100.
Next day, Share dropped by 2℅ and Nifty future by 1.5℅.
What will be profit/loss??
Explain how there is gain on future with proper explanation??
Thanking you.
Shorting means you 1st you sell and then buy later
Your Nifty Buying Price will be = 1100*98.5% and Share Selling Price will be 22*98%
Profit = Selling Price- Buying Price
Profit from Shorting Nifty = 400*1100*1.5% = 6600
Loss from Share = 10000*22*2% = 4400
Net = 2200 Profit
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