Portfolio Hedging Calculator
How many index futures lots to sell to hedge your stock portfolio.
How the Portfolio Hedging Calculator works
A portfolio with a beta of 1.2 tends to move 1.2% for every 1% move in the index. To protect it from a fall, sell index futures worth portfolio value × beta. This calculator converts that into lots of the index future and shows the margin you would need.
Portfolio Hedging Calculator formula
How to use the Portfolio Hedging Calculator
- Enter your portfolio value and its beta.
- Enter the index level and lot size of the hedging contract.
- See how many lots you need to hedge the portfolio.
Portfolio Hedging Calculator: FAQs
Why round the lots?
Futures trade only in whole lots, so the hedge is rarely exact. Rounding down leaves part of the portfolio unhedged; rounding up slightly over-hedges it.
Is the Portfolio Hedging Calculator free to use?
Yes. The Portfolio Hedging Calculator on IPO Darbaar is free, needs no sign-up and works on mobile and desktop.
Is my data saved anywhere?
No. All calculations run in your browser; the numbers you enter are not sent to or stored on our servers.
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