How is hedging different when using futures vs. forwards

Assignment Help Finance Basics

Reference no: EM13290435

How is hedging different when using futures vs. forwards?

a. Hedging with futures, you take delivery of the underlying currency, therefore locking in the price of the currency
b. Hedging with futures, you hold the contracts to expiration
c. Hedging with futures, you offset gains or losses on the spot price for the currency with gains or losses on the futures position
d. Two of the above
e. All of the above

Reference no: EM13290435

Questions Cloud

What is the wavelength of the laser beam : A carbon dioxide laser is an infrared laser. A CO2 laser with a cavity length of 53.00 cm oscillates in the m=100,000 mode. What is the wavelength of the laser beam

Explain hydrochloric acid is required to prepare the volume : What volume (in mL) of 25.0 M hydrochloric acid is required to prepare the volume of 17.0 M hydrochloric acid you found you needed in A to neutralize 4.0 grams of aluminum (III) hydroxide

Derive a minimum-cost realization of four variable function : Derive a minimum-cost realization of the four variable function that is equal to 1 if exactly two or exactly three of itsvariables are equal to 1; otherwise it is equal to 0.

Find how much additional charge flows to the positive plate : An uncharged capacitor is connected to the terminals of a 3.0 battery, and 12 flows to the positive plate. How much additional charge flows to the positive plate

How is hedging different when using futures vs. forwards : How is hedging different when using futures vs. forwards?

What is the purpose of hedging with futures : What is the purpose of hedging with futures?

Which bond has the higher yield after inflation : If a similar US dollar denominated bond yielded 6.0%, which bond has the higher yield after inflation? Is the difference less than .2%? Assume the current spot is $1.2200/E and one-year forward is $1.2450/E. Show work.

Find the position of the least significant zero : Given a 16-bit number stored in memory at address x4000. Find theposition of the least significant zero. The program will need toload the number from memory and analyze it to detect the locationof the least significant zero.

State the ideal gas equation of state to estimate the molar : Use the ideal gas equation of state to estimate the molar volume in m3/mol and the density of ari in kg/m3 at 40 C and a gauge pressure of 3.0 atm.

User Account

All Pages