Expiration is approached for options that are near the money

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1. What happens to delta as expiration is approached for options that are near the money? It remains stable. It tends to rise. It tends to change more suddenly. It becomes fixed.

2. A perfect futures market means that _______. there are no transaction costs there are no restrictions to contracts between two parties arbitrage possibilities don't exist All of the above

3. The Dow Jones Industrial Average is ______. the market capitalization weighted the price weighted the geometric average the nonweighted arithmetic average.

4. When using stock index futures to hedge a portfolio of stocks, one way to improve the results of the hedge is to account for _______. the difference in volatility of the portfolio and the futures contract the difference in expected returns of the portfolio and the futures contract the difference in trading volume of the portfolio and the futures contract None of the above

5. What happens to gamma as expiration is approached for options that are far out of the money? It remains stable. It tends to rise. It can change dramatically. It approaches zero.I need an expert to answer these question asap.

Reference no: EM131893492

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