Raunak, I am an option trader and if you want, I can tell you the way to create synthetic short stock position using Options.
Say you want to short INFY at 2700.. So buy 1 Infy put option 2700, and sell 2700 call at the same time. Call pays for the almost 80 to 90% price of put (if instrument is liquid, then theoratically, Call will pay 100% price of put).
Margin will blocked for short Call. Almost equal to 1 futures contract. Buy as market falls, you margin will be freed.
If market goes up, both call and put will be loosing the value. which is same like your short future going against you.
If you want to keep short open for longer timeframe, then u can very well go for April contracts..
Now major issue is, the option contract for stocks are very limited in liquidity and hence very wide spread. I.e you get peanuts when u sell a option,and pay a bomb when u go to buy them. Hence this strategy is not applicable to majority of stocks in our mkt.
Some leading stocks like RIL, etc have fairly decent liquidity so be careful before using it.
Certainly worth backtesting if you are really interested in it.
I am waiting for the day when our stock options becomes more liquid.
Happy Trading