The Correlation Between Changes in Price of a Spot Asset

question 9

Multiple Choice

The correlation between changes in price of a spot asset and futures asset is 99%.The standard deviation of changes in spot prices is $2,and that of futures prices is $3.What is the standard deviation of a position that is long 5 units of the spot asset and is hedged by shorting 4 units of futures?

• A)1.5
• B)2.0
• C)2.5
• D)3.0

Recognize the different types of housing available and their characteristics.

Understand mortgage financing options, including the calculations and considerations involved in mortgage payments and refinancing.

Gain knowledge of the legal and procedural steps involved in buying and selling real estate, including the roles of earnest money, closing costs, and title insurance.

Understand the implications of different mortgage types and terms, including adjustable-rate mortgages, FHA and VA loans, and home equity loans.

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Definitions:

Department Manager

A managerial position responsible for overseeing the operations and performance of a specific department within an organization.

Human Resources

An organizational function focused on the recruitment, management, and direction of people who work in an organization.

Independent Survey

A research study conducted by an organization or individual not affiliated with the subjects being surveyed to ensure unbiased results.

Department Manager

An individual who is in charge of a specific department within a company, overseeing its operations, budget, and staff.