A client has a portfolio of shares currently valued at $$5$ million. Assume that the SPI $200$ is now trading at $5010.$ The client is expecting a downturn in the share market in the short term.

To hedge the portfolio against a fall in the market, they could:

$1)$ buy $998$ ASX SPI $200$ Index Futures Contracts

$2)$ buy $40$ ASX SPI $200$ Index Futures Contracts

$3)$ sell $998$ ASX SPI $200$ Index Futures Contracts

$4)$ sell $40$ ASX SPI $200$ Index Futures Contracts