Index put options are used to provide protection against the value of the portfolio falling below a certain level.Which of the following is true as the beta of the portfolio increases?
A) The cost of hedging increases
B) The required options have a higher strike price
C) The number of options required increases
D) All of the above

Question

Quizplus · Accepted Answer

As beta increases A,B,and C are all true.

Index Put Options Are Used to Provide Protection Against the Value