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7. Brown owns 20,000 shares of CHM. The shares are currently priced at $45. A call option on CHM with a strike price of $50

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7. Brown owns 20,000 shares of CHM. The shares are currently priced at $45. A call option on CHM with a strike price of $50 is selling at $1.50 and has a delta of 0.4. The option contract size is 100 shares. What is the number of call options necessary to create a delta-neutral hedge (Buy or write)? (10 marks)

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