The Number of Futures Contracts That an FI Should Buy

question 50

Multiple Choice

The number of futures contracts that an FI should buy or sell in a macrohedge depends on the

• A)size of its interest rate risk exposure.
• B)direction of its interest rate risk exposure.
• C)return risk trade-off from fully hedging that risk.
• D)return risk trade-off from selectively hedging that risk.
• E)All of these.

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Definitions:

Secondary Structure

The level of protein structure involving hydrogen bonding between the backbone amide and carbonyl groups, forming alpha-helices and beta-pleated sheets.

Double Helix

The structure formed by double-stranded molecules of nucleic acids such as DNA.

Random Coil

A polymers' configuration in solution where it adopts an erratic, non-ordered shape due to the random distribution of the torsion angles along its chain.

Creutzfeldt-Jakob Disease

A rare, degenerative, and invariably fatal brain disorder that belongs to a group of conditions known as prion diseases.