You Own a Portfolio That Is Valued at $11,190,000 and Has

question 99

Multiple Choice

You own a portfolio that is valued at $11,190,000 and has a beta of 1.43. You would like to create a riskless portfolio by hedging using S&P 500 futures contracts. The contract size is $250 times the index level. How many futures contracts do you need to acquire if the current S&P 500 index is 1730?

• A)short 28 contracts
• B)short 37 contracts
• C)long 28 contracts
• D)long 37 contracts
• E)short 43 contracts

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Definitions:

Adolescents

Individuals in the transition stage from childhood to adulthood, typically ranging from ages 13 to 18.

High School

An educational institution for adolescents, typically offering education from grades 9 or 10 through 12, preceding college or university.

Male Aggression

A behavior pattern seen in males, both human and animal, that is characterized by forceful actions or attitudes intended to dominate or control.

Gender Inequality

The societal mechanism through which individuals face unequal and unfavorable treatment in comparable situations due to their gender.