Assume a Portfolio Manager Created a Short Interest Rate Hedge

Multiple Choice

Assume a portfolio manager created a short interest rate hedge for his/her portfolio. Given this hedge, the manager is

A) essentially eliminating both the downside risk and the upside potential.
B) eliminating the downside risk without hampering the upside potential.
C) partially diminishing the downside risk without impairing the upside potential.
D) eliminating the downside risk and increasing the upside potential.