USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 128

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
As a portfolio manager, you are responsible for a $150 million portfolio, 90 percent of which is invested in equities, with a portfolio beta of 1.25. You are utilizing the S&P 500 as your passive benchmark. Currently the S&P 500 is valued at 1202. The value of the S&P 500 futures contract is equal to $250 times the value of the index. The beta of the futures contract is 1.0.
-Refer to Exhibit 15.11. If you anticipate a cash inflow of $2 million next week, how many futures contracts should you buy or sell in order to mitigate the effect of this inflow on the portfolio's performance (rounded to the nearest integer) ?

• A) sell six contracts
• B) buy six contracts
• C) sell eight contracts
• D) buy eight contracts
• E) buy seven contracts

---

Definitions:

Code of Ethics

A set of guiding principles designed to help professionals conduct their business honestly and with integrity.

Therapists

Professionals skilled in treating mental or psychological disorders through various methods, including counseling and psychotherapy.

Confidentiality

The ethical principle or legal right that a professional will keep certain information shared by clients or patients strictly private.

Duty to Protect

Duty to protect is a legal and ethical obligation of mental health professionals to take steps to protect individuals who are in imminent danger of harming themselves or others.