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  3. 3 1 point the size of a futures contract is 2,000

3 1 point The size of a futures Contract is 2,000 units and you wish...

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3 1 point The size of a futures Contract is 2,000 units and you wish to use these futures to hedge the purchase of 60,000 units of a different asset. The hedge ratio is 1.5. The futures price is $30 per unit and the spot price is $20 per unit. How many futuros contracts will you use to tail the hedge? 40 15 OOOO 25 30 A company has a $20 million portfolio of stocks with a beta of 1.25. The S&P index is currently standing at 4,000. Future contracts on $250 times the S&P index can be traded. What trade is necessary to reduce the beta of the portfolio to 1.0? O Short 5 futures contracts Short 10 futures contracts Long 5 futures contracts Long 10 futures contracts

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