The number of future contracts needed to hedge a unit of the spot assets is solely a function of the variance of the spot prices.
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Q5: The cost-of-carry model is useful for pricing
Q6: Like future contracts, all forward contracts are
Q7: Some forward contracts, particularly in the foreign
Q8: Margin accounts are adjusted, or marked to
Q9: Interest rate parity is a key concept
Q11: The pure expectations hypothesis suggests futures prices
Q12: An investor in a hedge position is
Q13: Because futures contracts are "marked-to-market" daily, the
Q14: The settlement price is set by the
Q15: The basis (Bt,T) at time t between
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