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plenty of stuff available online. you can get the definitions and explanations all over the web. but understanding the formula is key.
in simple terms , it show how well the risk adjusted returns are made by a fund or manager.
it shows how much returns are made after taking out risk free returns(normally 10 y govt bond) w.r.t the risk you are taking
so if nifty annual vol is 20% , which is the expected risk on downside.
so one fund manager or fund makes say 30% return in a year. you remove 7.5% from that because you are not taking any risk for that 7.5%. i.e there is no risk in that 7.5%. since this 7.5% is guaranteed by the govt bonds.
now you have 22.5% / 20% = 1.125 is the sharpe ratio.
you have now taken risk only for that 20% and you have returned more than 20% , hence the sharpe ratio is above 1. This is the risk adjusted return.
Very hard to go over 1 for many people in this business.
Everyone should calculate their performance using sharpe ratio. I bet most people will stop trading and start investing. LOL.
It lists all the required margins (for equity & indexes).
“NRML Margin” is the amount required if you want to hold the position overnight (or few days).
“MIS Margin” is the amount required if you want to trade on intraday.
First of all you need to understand the concept of opening a fresh position and closing a position. Squaring off means you are just closing the existing open position(just reversing the trade…either in profit or loss). In the options context this gets tricky for new guys…Lets says your view is bullish then you buy call option, which is long position (for Rs 5)…after few minutes/hours/days you see premium is appreciated (say to Rs.10) and you want to book the profit…you are closing the position ie selling the options )that was bought earlier…it is alo called as squaring off the existing positon…Now keep in mind you are not creating a new sell position here…Howver you cann aalso write/sell call options if you feel prices will go down…you squareoff by buying it back later at lower price
Yes, in this case profit of Rs 5 will be made (ignoring brokerage, taxes, etc)
If you had previously bought the Call option, then selling it would only square off the current open position and you will have your profit. If you want to create a new Sell position with that call options in which you are already long, you will have to sell 2 Call Options… I Call will square off the current open long position and the second one will create a new Call write (sold) position…
If you wait till expiry then either your long call will be exercised if it’s In-the-Money or it will become 0 value if Out-of-Money in which case you will lose the Rs 5 that you had paid to buy the Call.
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