How Would You Delta Hedge a Deeply "In-The-Money" Short Put

question 271

Multiple Choice

How would you delta hedge a deeply "in-the-money" short put option?

• A) Go short of the underlying commodity equal to 50% of the size of the option contract
• B) Go long of the underlying commodity equal to 50% of the size of the option contract
• C) Go long of the underlying commodity equal to more than 50% of the full size of the option contract
• D) Go short of the underlying commodity equal to more than 5O% of the full size of the option contract

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Definitions:

Conflicting Interests

Situations where different parties have goals or intentions that are incompatible or at odds with one another.

Organizational Decision Making

The process by which decisions are made within an organization, involving the selection of courses of action among several alternatives to achieve objectives.

Intangibles

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Customer Goodwill

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