7. Price changes of two gold mining stocks have shown strong positive correlation. Their historical relationship is Average percentage change in A-0.001 0.6 percentage change in B) Changes in explain 60% of the variation of the changes in AR0.6). a. Suppose you own $116,000 of A. How much of should you set to minimize the risk of your net position? Amount of Bowl b. What is the hedge ratio? (Round your answer to 2 decimal places.) Hodgers Here is the historical relationship between ock A and gold prices Average percentage change in A-0.002 + 1 40percentage change in gold price) 01. * = 44, can you lower the risk of your net position by hedging with gold for gold futures) other than with stock ? Yes No c.2. Will this provide as good of a hedge as the sale of stock 87 7. Price changes of two gold mining stocks have shown strong positive correlation. Their historical relationship is Average percentage change in A-0.001 0.6 percentage change in B) Changes in explain 60% of the variation of the changes in AR0.6). a. Suppose you own $116,000 of A. How much of should you set to minimize the risk of your net position? Amount of Bowl b. What is the hedge ratio? (Round your answer to 2 decimal places.) Hodgers Here is the historical relationship between ock A and gold prices Average percentage change in A-0.002 + 1 40percentage change in gold price) 01. * = 44, can you lower the risk of your net position by hedging with gold for gold futures) other than with stock ? Yes No c.2. Will this provide as good of a hedge as the sale of stock 87