A Hedge Ratio of 0

question 30

Multiple Choice

A hedge ratio of 0.70 implies that a hedged portfolio should consist of ________.

• A) long .70 calls for each short stock
• B) long .70 shares for each long call
• C) long .70 shares for each short call
• D) short .70 calls for each long stock

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Definitions:

Moose Carcass

The body of a dead moose, often serving as a source of nutrition for various predators and scavengers in an ecosystem.

Mutualistic Relationship

A type of interaction between two different species where both individuals derive a benefit.

Red-Billed Oxpecker

A bird species known for feeding on ticks and parasites found on the skin of large mammals, such as cattle and wild ungulates.

Ticks

Small arachnids, part of the order Ixodida, which are ectoparasites living by hematophagy on the blood of mammals, birds, and sometimes reptiles and amphibians, known for transmitting various diseases.