How hydro uses derivatives to hedge

Reference no: EM133559814

Question: Describe in detail how hydro uses derivatives to hedge its respective risk exposures. Does the firm make a profit or loss from its hedging strategies? What other hedging strategies could Hydro have implemented? What is the impact of simple naked (uncovered) strategies on your proposed hedging strategy?

As Hydro isn't publicly listed, briefly explain what management can do to have a perfectly hedged position by using stocks and call options.

Reference no: EM133559814

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