On April 1, an investor holds 40,300 shares of a certain stock. The market price is $25 per share. The investor is interested in completely hedging against movements in the market over the next month and decides to use the June Mini S&P 500 futures contract.

On April 1, an investor holds 40,300 shares of a certain stock. The market price is $25 per share. The investor is interested in completely hedging against movements in the market over the next month and decides to use the June Mini S&P 500 futures contract. The index is currently 4,000 and one contract is for delivery of $50 times the index. The beta of the stock is 1.9. What strategy should the investor follow (3 marks)

Expert's Answer

Your future, our responsibilty submit your task on time.

Order Now

Need Urgent Academic Assistance?

Get Professional Help at Low Prices!

*
*
*


*

TOP
Order Notification

[variable_1] from [variable_2] has just ordered [variable_3] Assignment [amount] minutes ago.