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bulgar [2K]
3 years ago
14

A customer has a broadly diversified stock portfolio with a current market value of $2,500,000. The customer wishes to hedge the

portfolio against a market decline. The customer should:________
A. sell short the exact same stock positions as those held in the portfolio
B. sell 100 SPX 2500 Calls
C. buy 100 SPX 2500 Puts
D. sell long the exact same stock positions as those held in the portfolio
Business
1 answer:
Mars2501 [29]3 years ago
8 0

Answer:

C) buy 100 SPX 2500 Puts

Explanation:

SPX stock is based on the Standard and Poor's stock index, so if the investor is worried about a market decline, if he purchases put options and the marker declines, he/she will actually earn money. Each SPX 2500 contract covers approximately $250,000 of portfolio value, so if the investor purchases 10 put options then the whole portfolio would be covered.

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Which of the following are NOT included in the formal financial analysis of a capital budgeting program?
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Answer: Option B

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In the capital budgeting process, only the quantitative aspects of a project will be taken into consideration and qualitative aspects such as quality and work space safety are not considered.

Hence from the above we can conclude that the right option is B.

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3 years ago
For many years you have been using your local, small-town bank. One day you hear that the bank is about to be purchased by Bank
kari74 [83]

Answer:

If I was banking with my local town bank and it happens that Bank of Africa purchases it, there are cost and benefits associated with the merge. First, Bank of America is global, meaning that I will be able to access the Services such as ATM services at different points. Second, due to its area of coverage, the services are cheaper compared to the ones I got when it was in my local town. However, due to the monopoly of the bank, they might increase the charges making them more expensive than when the services in the local village. Additionally, it will be a challenge for average customers, such as farmers, to access big banks unless faithful people accompany them.

Explanation:

7 0
3 years ago
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-Dominant- [34]

Explanation:

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When marketers target future buyers with sampling, coupons, and rebates while using publicity to target all customers in a parti
Akimi4 [234]

They are exhibiting management of the promotion mix in marketing.

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4 0
2 years ago
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