When would you use puts to delta hedge a portfolio?作者: jmh530 时间: 2013-4-14 20:15
If you are long Equity.作者: wizofoz 时间: 2013-4-14 20:15
You can also hedge the delta from being Long Equity with Short Call. Doesn’t really matter, with both you have to rebalance continuously. Since the Delta of both the Call and the Put will change due to market conditions (spot change, vola, interest, dividend, whatever).
There isn’t just one solution to delta hedging.作者: Swanand 时间: 2013-4-14 20:16
It is typically the case the long equity will buy protection using a long put, and not necessarily use it for delta hedging. While you certainly can do it, it is more common to use a put to delta hedge a short position in equity with a short position in the put.作者: ShooterMcCFA 时间: 2013-4-14 20:16
So basiscally you can do it either way, hedge a short in a stock by shorting a call or shorting a put?作者: Siddimaula 时间: 2013-4-14 20:17
A short in a stock can’t be hedged with a short call. That has to be done with a long call or a short put.
