put options delta hedging

CFA Level III Derivatives
#1

2012 CFAI morning exam q 9:

Part A ii asks for how many # of shares should he trade??? Can somebody clarify what’s going on here?

Help much appreciated.

#2

Using the same hedging formula, but this time you do not calculate number of option, but number of shares.

#3

To hedge 1 put you need to sell 0.3088 shares

=>To hedge 2000 puts, you need sell 2000*0.3088 = 617.6 shares.

#4

617 is the correct answer the one in the guidline answers is not correct its the amount needed to buy 617 options

#5

Thanks guys so much. I got it now.