Hi all !
Please tell,
From where to get Nifty interest rate for option pricing ?
I think, it is the interest rate given by RBI for interbank landing. This is supposed to be risk free rate and used by FI and banks in money market.
In my view, fixed deposit rate varies from bank to bank so it is difficult to find 1 single number.
anyway, whatever it maybe, I have found that option's theortaical price is not very sensitive to interest rate. There are other factors like - remaining life, Volatility, and other greeks have high impact on options theoratical price.
on top of this, traded option price is hardly equal to theoratical price (though it gets clue from theoratical price). So why bother about it from trading perspective.
If one is doing research, then it is different matter.
just my views, pokrate.
Happy Trading.