If the current price of a share is Rs. 100/- (Beta 1.1 with Sensex) and a person has purchased 1000 shares. How can he perfectly hedge the situation by selling index futures. Index futures is avialble at 4500 index points and one contract of futures comprises at 50 units.
My major concern in this question is how to compute the value of one unit of index.
Pls. do reply and advise me on calculation of value of one unit of index.
CAclubindia
