Have portfolio – buy puts
You own an equity portfolio and one day you become uncomfortable about the overall stock markets. You fell that the stock prices will fall or you feel that there is going to be a certain period of uncertainty or volatility due to a particular event like the budget, and you do not want to be a part of the volatility. Index options is a cheap and easily implementable way of seeking the insurance for your portfolio. You own an equity portfolio and one day you become uncomfortable about the overall stock markets. You fell that the stock prices will fall or you feel that there is going to be a certain period of uncertainty or volatility due to a particular event like the budget, and you do not want to be a part of the volatility. Index options is a cheap and easily implementable way of seeking the insurance for your portfolio.
SPECULATION
Bullish – buy calls or sell puts
Bearish – buy puts or sell calls
