How Frequently Should You Consider Rebalancing the Options Hedge on a Large

question 22

Multiple Choice

How frequently should you consider rebalancing the options hedge on a large equity portfolio if you wish to maintain an effective hedge?

• A)weekly
• B)annually
• C)just prior to the fiscal year end
• D)at option expiration
• E)only when the options are in the money

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Definitions:

Morphemes

Morphemes are the smallest grammatical units in a language that have meaning or grammatical function.

Phrases

Groups of words that function as a unit within a sentence but do not contain both a subject and a verb.

Units of Sound

The basic components of speech, such as phonemes, which are the smallest units of sound that can differentiate meaning.

Verbs

A class of words that denote action, occurrence, or a state of being.