I am studying for the first time European Put Option and Delta Hedge that is related to Black Scholes.
I would like to know how can I solve this problem:
A trader wants to sell 10 Put Options at 300$. How would you Delta Hedge your exposure on this contract and how would the hedge be managed over 6 months until the exercise date?
I have the following information:
Risk-free interest rate: 3%;
Strike price: 1900$
Stock price: 1790$
Annual volatility: 0.222
I am trying to find online examples but until now I could not find anything, also, I am not sure if this is related to the topic "Delta hedging of a stock position using options".
Can anyone give any tip in how to start?
Thanks