A Fully Hedged Stock Portfolio Will Have a Beta Equal

question 29

Multiple Choice

A fully hedged stock portfolio will have a beta equal to which one of the following?

• A)an average asset
• B)U.S. Treasury bill
• C)S&P 500
• D)the beta of the stock portfolio exclusive of the hedge
• E)one-half of the beta of the stock portfolio exclusive of the hedge

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Definitions:

Continuity Theory

The theory suggesting that people need to maintain their desired level of involvement in society in order to maximize their sense of well-being and self-esteem.

Aging

The process of becoming older, a sequence of physical, psychological, and social changes over time.

Midlife Transition

A period in middle adulthood during which people begin to reassess their achievements, goals, and aspirations, often leading to significant personal change.

Daniel Levinson

A psychologist known for his theory on human development, especially regarding stages of life, including the concept of the mid-life crisis.