Intermediate
Understanding Options as a Hedging Tool for Investors
A concept-first course on options as insurance for people who already own stocks and mutual funds. Built for experienced retail investors, mutual fund investors, and salaried professionals who want to understand when and how to protect a portfolio without turning into F&O traders. Covers the hedger's mindset, protective puts, hedging a mutual fund portfolio with Nifty options, covered calls and collars, the real costs, margins, and taxes of hedging in India, and a clear framework for when hedging is worth it. Uses NSE contracts, India VIX, real Indian market events, Zerodha costs, and SEBI's F&O rules throughout.
Hedging vs SpeculationProtective PutsIndia VIXBeta and Basis RiskNifty Index HedgingCovered CallsCollarsCost of HedgingTaxation of OptionsSEBI F&O Rules
MODULES
6
DURATION
~3.9 hrs
TRACK
Options & Derivatives
What You'll Master
Tell the difference between using options to hedge and using them to speculate, and why the mindset changes every decision
Treat a put option as an insurance policy, mapping strike, premium, and expiry to deductible, cost, and term
Hedge a diversified stock or mutual fund portfolio with Nifty options by adjusting for beta and sizing the number of lots
Use covered calls and collars to reduce or eliminate the cost of protection, and know what you give up in return
Calculate the real cost of a hedge, including time decay, rolling, brokerage, margin, and tax treatment in India
Decide when hedging is worth it and build a simple, rules-based hedging plan for your own portfolio
Access Level
LEARNER
Everything included
Full Text Playbooks
Actionable Exercises
Mobile Reading Mode
Lifetime Updates
Curriculum Breakdown
Chapter 1: Thinking Like a Hedger, Not a Trader
4 Lessons▶
Hedging vs Speculation: Why Investors Use Options Differently9 min read
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What You Are Actually Protecting Against: Drawdowns, Timing, and Goal Risk9 min read
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A Quick Options Refresher for Investors: Calls, Puts, Premium, and Expiry10 min read
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Moneyness and Strike Choice Through an Insurance Lens9 min read
Chapter 2: Puts as Portfolio Insurance
4 Lessons▶
The Protective Put: Setting a Floor Under a Stock You Own10 min read
▶
Deductible, Premium, and Term: Mapping Insurance Language to Put Options9 min read
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Reading the Payoff: Hedged vs Unhedged Positions at Expiry10 min read
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What Drives the Cost of Protection: Time, Volatility, and India VIX10 min read
Chapter 3: Hedging a Mutual Fund or Diversified Portfolio with Nifty Options
4 Lessons▶
You Cannot Buy Options on Your Mutual Fund: The Index Proxy Solution9 min read
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Beta and Basis Risk: How Closely Your Portfolio Really Tracks the Nifty10 min read
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Sizing the Hedge: How Many Nifty Lots Protect Your Portfolio11 min read
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Case Study: A Salaried Investor's Portfolio Around the June 2024 Election Results11 min read