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Explain the benefits of the following portfolio. A portfolio consists of purchasing a forward contract for an asset and purchasing a European put option for
Explain the benefits of the following portfolio. A portfolio consists of purchasing a forward contract for an asset and purchasing a European put option for that asset. The maturity of a put option is the same as the maturity of the forward contract and the strike price of the put option is the same as the forward price of the asset when constructing the portfolio.
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