If the Hedge Ratio for a Stock Call Is 0

question 60

Multiple Choice

If the hedge ratio for a stock call is 0.70, the hedge ratio for a put with the same expiration date and exercise price as the call would be

• A)0.70.
• B)0.30.
• C)-0.70.
• D)-0.30.
• E)-.17.

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Definitions:

Governs Least

A principle often associated with libertarianism, suggesting that the best government is one that exercises minimal intervention in personal lives and the economy.

Government

The organization or system through which a community or nation is governed, responsible for creating and enforcing rules and managing public resources.

Thomas Jefferson

The third President of the United States, a Founding Father recognized for authoring the Declaration of Independence.

Taxation

The process by which governments impose charges on citizens and corporate entities to fund public expenditures and services.