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company is looking to hedge its exposure to aluminium prices and is considering using copper utures for this purpose. The following information is available: /
company is looking to hedge its exposure to aluminium prices and is considering using copper utures for this purpose. The following information is available: / 'n Maatskappy wil sy blootstelling an aluminiumpryse verskans en oorweeg dit om kopertermynkontrakte vir hierdie doel te gebruik. Die volgende inligting is beskikbaar: The correlation between the spot price of aluminum and the copper futures price is 0.88 . / Die korrelasie tussen die lokoprys van aluminium en die kopertermynprys is 0.88 . The standard deviation of the spot price of aluminum is 0.045. / Die standaardafwyking van die lokoprys van aluminium is 0.045 . The standard deviation of the copper futures price is 0.040 . / Die standaardafwyking van die kopertermynprys is 0.040 . Tons of aluminium to be hedged: 5000 / Ton aluminium wat verskans moet word: 5000 Number of tons per LME copper contract: 25 / Aantal ton per LME-koperkontrak: 25 Salculate the optimal number of copper futures contracts required. / Bereken die optimale aantal ropertermynkontrakte wat benodig word
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