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A company has a portfolio of stocks worth $33 million. The beta of the portfolio is 1.3. The company would like to use six month
A company has a portfolio of stocks worth $33 million. The beta of the portfolio is 1.3. The company would like to use six month futures contract on a stock index to change beta of the portfolio to 0.65 during the five month period prior to the month of the hedging futures expiration. The index is currently 3200, and each contract is on $250 times the index. What position should the company take?
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