Essentials of Investments (The Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
Essentials of Investments (The Mcgraw-hill/Irwin Series in Finance, Insurance, and Real Estate)
10th Edition
ISBN: 9780077835422
Author: Zvi Bodie Professor, Alex Kane, Alan J. Marcus Professor
Publisher: McGraw-Hill Education
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Chapter 17, Problem 25C

a. How would your hedging strategy in the previous problem change if, instead of holding an indexed portfolio, you hold a portfolio of only one stock with a beta of 0. 6 ?
b. How many contracts would you now choose to sell? Would your hedged position be riskless?
c. What would be the beta of the hedged position? LO 17 2

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Investing For Beginners (Stock Market); Author: Daniel Pronk;https://www.youtube.com/watch?v=6Jkdpgc407M;License: Standard Youtube License