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A company knows that it is due to receive a certain amount of a foreign currency in four months. What type of option contract is
A company knows that it is due to receive a certain amount of a foreign currency in four months. What type of option contract is appropriate for hedging?
a) A quick position in a four-month put option
b) A long position in a four-month put option
c) A short position in a four-month put option
d) This one cannot be hedged
I know that it has to be a put option so its not d, but I am having trouble with knowing the positon in the 4 months in this scenario when hedging, please explain what option is correct, thank you!
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