Conyers Bank Holds Treasury Bonds with a Book Value of $30

Multiple Choice

Conyers Bank holds Treasury bonds with a book value of $30 million. However, the Treasury bonds currently are worth $28,387,500. How can the portfolio manager use futures markets to protect against the risk exposure of rising interest rates?

A) Buy interest rate futures.
B) Sell currency futures.
C) Buy currency futures.
D) Sell interest rate futures.
E) Sell stock market index futures.