If you own 200 shares of stock at $50 and you want to hedge it with a
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Question:
If you own 200 shares of stock at $50 and you want to hedge it with a put option that expire in 60 days, what will my final put protection be if I have a strike price of 45 and the stock fall to $35 if the put costs $5? Calculate the value of the net put value and how much this will protect your stock position in dollar and % terms. Explain in detail. Assume you buy enough puts to properly hedge the stock at its share number(without delta consideration)
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