1. The KLSE CI is at 1250. The value of your portfolio is RM2.5million. If you wish to hedge against a market downturn as completely as possible, do you buy or sell futures contract?

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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financial risk management 


1. The KLSE CI is at 1250. The value of your portfolio is RM2.5million. If you wish to hedge against a market
downturn as completely as possible, do you buy or sell futures contract?

2. The buyer of the option is not obligated to complete the deal and will do so only if changes in price make it profitable to do so. ( True/ False)

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