Hedging with Regression Can Be Viewed as A

question 19

Multiple Choice

Hedging with regression can be viewed as a:

• A)special case of maximizing variance hedging when the hedging instrument is costless.
• B)special case of minimizing variance hedging when the hedging instrument is costless.
• C)special case of maximizing variance hedging when the hedging instrument is costly but risk-free.
• D)special case of minimizing variance hedging when the hedging instrument is costly but risk-free.

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