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Which of the hedging strategies will make money

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Reference no: EM132960880

Problem 1: You are a producer of a commodity. Which of the following hedging strategies will make money if commodity spot price settles at $120?

a. Sell a swap at $100
b. Write a call option with a strike $100 and premium $.50
c. Buy a put option with strike of $100 and premium $2.50
d. Buy a put option with a strike of $50 and premium $0.15 and sell a call option with a strike $150 and premium $0.25

Reference no: EM132960880

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