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posledela
3 years ago
8

A company has a $36 million portfolio with a beta of 1.2. The futures price for a contract on the S&P index is 900. Futures

contracts on $250 times the index can be traded. What trade is necessary to achieve the following. (Indicate the number of contracts that should be traded and whether the position is long or short.)
a. Eliminate all systematic risk in the portfolio
b. Reduce the beta to 0.9
c. Increase beta to 1.8
Business
1 answer:
Blizzard [7]3 years ago
7 0

Answer:

Explanation:

A:

Number of contracts required:

= (0-1.2)×36,000,000÷(900×$250)

= -192

Since negative value, short 192 contracts.

B:

= (0.9 - 1.2)×36,000,000÷(900×$250)

= -48

Since negative value, short 48 contracts.

C:

= (1.8 - 1.2)×36,000,000÷(900×$250)

= 96

Since positive value, long 48 contracts.

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Araceli is a team member in a large corporation. She never speaks in team meetings because she has seen members talk behind each
Marina CMI [18]

Answer: Climate of trust.

Explanation:

Araceli's team lack the climate of trust where team members can easily express themselves and raise ideas that is useful in problem solving. In a team with climate of trust, it is easier for team members to raise ideas and those ideas are brainstormed upon until the best idea is chosen, in such a team there is modest.

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3 years ago
Which of the following are attributes of California's legislative process for passing state budgets and controlling taxes?
scoray [572]

Answer:

- The state's constitution allows budgets to be passed with a simple majority vote in both the Assembly and the Senate.

- Taxes can only be cut with a two-thirds vote in the Assembly and the Senate.

Explanation:

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3 years ago
Sara is an administrator at a bank. sara eats plenty of fruits, vegetables, whole grains, legumes, and lean meats. she is of nor
Tresset [83]
She could exercise. Since she is sitting at a desk all day, going on runs on lunch break or when she wakes up could really help promote a healthy lifestyle.


I hope this helped!
4 0
3 years ago
It is safe to use your bright headlights if there is a car ahead of you within 300 feet. True or False?
monitta
True.
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6 0
3 years ago
Read 2 more answers
Nancy has a portfolio of two stocks. Stock A has an expected return of 8% and stock B has an expected return of 10%. Her funds a
dedylja [7]

Answer:

b. 8.92%

Explanation:

Calculation for the portfolio expected return

Using this formula

Portfolio expected return = (Stock A allocated fund x Stock A expected return) + (Stock B allocated fund x Stock B expected return)

Let plug in the formula

Portfolio expected return= (54%*8%) + (46%*10%)

Portfolio expected return=0.0432+0.046

Portfolio expected return=0.0892*100

Portfolio expected return =8.92%

Therefore the portfolio expected return will be 8.92%

7 0
3 years ago
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