In Problem 4, suppose that after a few weeks, the value of your stock portfolio is $2.45 million, the OEX index is 313.56, and the put delta is – 0.245. What do you need to do to get your portfolio back to a delta neutral position?

Problem 4

Save your time - order a paper!

Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlines

Order Paper Now

You want to hedge your stock portfolio using OEX index puts. Your portfolio is worth $2.5 million and has a beta of 1.12; the current level of the OEX index is 315.55. The 325 OEX puts you have selected have a delta of – 0.223. How many of these OEX puts do you need to buy?


"Looking for a Similar Assignment? Get Expert Help at an Amazing Discount!"