Multiple Choice
A portfolio consists of 400 shares of stock and 200 calls on that stock.If the hedge ratio for the call is 0.6,what would be the dollar change in the value of the portfolio in response to a one dollar decline in the stock price?
A) +$700
B) +$500
C) -$580
D) -$520
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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