Options are financial derivatives which are used as risk management tools for hedging the portfolios. The options … trade. Options trading can be taken to the next level with the help of understanding of Greeks and their Hedging techniques …. This knowledge will enhance the existing knowledge in context to the options hedging and will lead to the benefits in …

particular on the use of European put options as a strategic hedging tool. Inspired by the work of Merton (1974), our approach … reducing the necessary capital allocation for a projected loss X(T) by partially hedging with a European put option. We …