Question
It is June 8. A company knows that it will need to purchase 20,000 barrels of crude oil some time in November. The current December
It is June 8. A company knows that it will need to purchase 20,000 barrels of crude oil some time in November. The current December oil futures price is $68 per barrel. The company entered 20 Long Dec contracts. Assume the company is ready to purchase oil on Nov 10. Spot price on Nov 10 = $75, December futures price on Nov 10 = $72, whats the net cost of oil after hedging?
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Probability For Risk Management
Authors: Matthew J. Hassett, Donald G. Stewart
2nd Edition
156698548X, 978-1566985482
