If the Hedge Ratio for a Stock Call Is 0

question 1

Multiple Choice

If the hedge ratio for a stock call is 0.50, the hedge ratio for a put with the same expiration date and exercise price as the call would be

• A) 0.30.
• B) 0.50.
• C) −0.60.
• D) −0.50.
• E) −0.17.

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Definitions:

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Biased

A tendency to favor or lean towards a particular perspective, conclusion, or response, often in a way that is considered to be unfair or biased against other options.