1.Explain how an increase in implied vol would change your delta hedging position if the SAC option was In-The-Money, assuming you wanted to maintain a delta neutral position.

2.Explain how theta erosion affects your delta hedging position as the option approaches maturity if the SAC option is In-The-Money, assuming you wanted to maintain a delta neutral exposure.

3.If your boss told you to reduce the volatility of the portfolio's value as close to zero as possible, what trading strategy would you implement? Why?