A fund manager holds an investment in listed equity of £1million. It is expected that the market value of the equity will fall over next 3 months from the current level of 1669. Exchange-traded Options on the equity are available and the strike price is quoted as 1668. The contract size is 1,000 shares and the premium for each share is 11. 

a. To hedge the value of investment at risk exposure, what strategy should the fund manager consider? (5 marks)

b. Calculate the number of contracts proposed to use to hedge and the required premium. (8 Marks) c. Compare and contrast differences between futures and options.