A company has a $10 million portfolio with beta of 1.2.How can it use the SP500 futures contract (with a multiplier of 500) to create optimal hedge against a stock decline and what is the hedged return?The futures index is 1000.

Short 20 SP500 futures contracts for a risk-free return while hedged

Short 24 SP500 futures contracts for a risk-free return while hedged

Short 20 SP500 futures contracts for a return of 0% while hedged

Short 24 SP500 futures contracts for a return of 0% while hedged