22-115 If the Current (Spot)rate for One-Year British Pound Futures

question 121

Multiple Choice

22-115 If the current (spot) rate for one-year British pound futures is currently at $1.58/£ and each contract size is £62,500,how many contracts are required to be purchased or sold in order to fully hedge against the pound exposure? (Assume no basis risk) .

• A)Sell 1,600 BP futures.
• B)Buy 1,600 BP futures.
• C)Sell 1,712 BP futures.
• D)Buy 2,560 BP futures.
• E)Buy 1,712 BP futures.

---

Definitions:

Racial/Ethnic Subcultures

Specific subgroups within a broader culture, defined by shared racial or ethnic heritage, often having distinct values, traditions, and social practices.

Subculture

A group within a larger culture that differentiates itself with distinct values, behaviors, and interests.

Policy

A course of action or principle adopted or proposed by an organization or individual.

Named Beneficiary

An individual, group, or entity designated in an insurance policy or financial account to receive benefits or assets upon the occurrence of a specified event, such as the policyholder's death.