Do you buy or sell pound futures

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Reference no: EM131459129

This is a two part question:

a) The company you work for is set to pay 10,000,000 Pounds at the end of 2017. Your boss puts you in charge of hedging the price risk of these Pounds.

Do you buy or sell Pound futures?

How many? (Look up the contract size of pound futures)

Which futures (what maturity)?

b) Your company also owns a $50,000,000 stock portfolio. The portfolio has a beta of 1.2. Your boss wants to hedge the portfolio using e-mini S&P 500 futures and puts you in charge of doing it.

What do you do?

Reference no: EM131459129

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