Perfect Dynamic Hedging Requires ________

question 51

Multiple Choice

Perfect dynamic hedging requires ________.

• A) a smaller capital outlay than static hedging
• B) less commission expense than static hedging
• C) daily rebalancing
• D) continuous rebalancing

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Definitions:

Material Fact

A fact that is significant or essential to the issue or matter at hand, and could influence a decision.

Securities Exchange Act

The Securities Exchange Act is a U.S. federal law that governs the trading of securities, such as stocks and bonds, to protect investors against fraud and to regulate the securities industry.

Scienter

A legal term referring to the knowledge of wrongdoing, particularly in cases of fraud or deceit.

Fraud

The intentional deception to secure unfair or unlawful gain, or to deprive a victim of a legal right.