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5. Jane Morgan, CFA wishes to bedge ber clients' equity positions against an expected bear...

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Accounting

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5. Jane Morgan, CFA wishes to bedge ber clients' equity positions against an expected bear market using an equity forward contract with the following information: a. State what position (short or long) will Morgan take on this forward contract. Explain why. b. Caleulate the no arbitrage price of this forward contract today. Show your work. c. Suppose that three months have passed, and Morgan wants to compute the value of this contract. She observes the following additional information: - Market value of her portfolio today - Risk free Rate $32million4% Given the information above and your result in part b, calculate the value of this forward contract today to Morgan. Show all your work

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