The Tailed Minimum-Variance Hedge Ratio Becomes Lower in Comparison to the Untailed

Multiple Choice

The tailed minimum-variance hedge ratio becomes lower in comparison to the untailed one when

A) Nominal interest rates rise and hedge maturity increases.
B) Real interest rates rise and hedge maturity decreases.
C) Nominal Interest rates fall and hedge maturity increases.
D) Real interest rates fall and hedge maturity decreases.