4. A tader ownis 45,000 vait of a panicular asset and decides to bedge the Yotue ar her position with furures contracts on another related asset. Each filaien copicior the hedege is eatimated to be 50.43 . The futures price price over the life of hedge in 50,40. The coefliciention of the change ince of the related asset is and furtures price change is 0.95 . correfation berween the over the life of the (a) What is theominimiom variance (b) Should the hedger take a long or hedee ratios ( 7 marks) (c) What is the optimal number of fitures contures position? ( 6 marks) daily sevilement are not considered? (10 marks) forts when adjustments for (a) haa hap ==aq. terated are take rea short futures position, becanse the fatwes trice if the lowerthan 28 , hodger will anyy lose 0.4. 4. A tader ownis 45,000 vait of a panicular asset and decides to bedge the Yotue ar her position with furures contracts on another related asset. Each filaien copicior the hedege is eatimated to be 50.43 . The futures price price over the life of hedge in 50,40. The coefliciention of the change ince of the related asset is and furtures price change is 0.95 . correfation berween the over the life of the (a) What is theominimiom variance (b) Should the hedger take a long or hedee ratios ( 7 marks) (c) What is the optimal number of fitures contures position? ( 6 marks) daily sevilement are not considered? (10 marks) forts when adjustments for (a) haa hap ==aq. terated are take rea short futures position, becanse the fatwes trice if the lowerthan 28 , hodger will anyy lose 0.4