Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Chapter 17, Problem 25C

a. How would your hedging strategy in the previous problem change if, instead of holding an indexed portfolio, you hold a portfolio of only one stock with a beta of 0. 6 ?
b. How many contracts would you now choose to sell? Would your hedged position be riskless?
c. What would be the beta of the hedged position? LO 17 2

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