On June 30, 2018 a securities analyst recommended NINJA Ltd stock as a good purchase. The portfolio manager plans to buy 50,000 shares of the stock on September 30, 2018 but is concerned that the market as a whole will be bullish over the next three months. NINJAS stock is currently trading at $40.65 and the beta is 1.25. Construct a hedge that will protect against movements in the stock market as a whole. Use the December stock index futures, which is priced at 384.78 on June 30, 2018, and has a $500 multiplier. Evaluate the outcome of the hedge if on September 30, 2018, the futures price is 395.32 and NINJAS stock price is $42.04.