A bank manager will get $6 million to invest in 3 months. Interest rates are expected to fall; so when the money arrives he would have to invest at lower rates. He will invest in T-Bills. To protect his position, the manager decides to hedge by using T-bill futures. T-Bills T-Bill Futures Current Price $983, 190 $980, 750 Price in 3 months $985, 845 $983, 550 Should the bank manager use a long hedge or a short hedge? Calculate the number of contracts and his gain or loss on the hedge. Describe in detail two different ways you can hedge against foreign exchange risk. Use an example to illustrate. Preferably use the same example for all three strategies. A bank manager will get $6 million to invest in 3 months. Interest rates are expected to fall; so when the money arrives he would have to invest at lower rates. He will invest in T-Bills. To protect his position, the manager decides to hedge by using T-bill futures. T-Bills T-Bill Futures Current Price $983, 190 $980, 750 Price in 3 months $985, 845 $983, 550 Should the bank manager use a long hedge or a short hedge? Calculate the number of contracts and his gain or loss on the hedge. Describe in detail two different ways you can hedge against foreign exchange risk. Use an example to illustrate. Preferably use the same example for all three strategies