Please read the following article and discuss one of the hedge tools the firm identifies as providing partial to full protection during the pandemic crisis. Please address the following questions/topics:

1) How does the futures security that you selected work to reduce or fully mitigate risk? Be specific in your description of the risk being mitigated and the mechanics of the futures security and the spot position being hedged.

2) How effective do you believe this hedge will be? What are the assumptions that must be realized to make the hedge effective? Are these realistic expectations in light of the information we now know?

DOES NOT NEED MORE INFORMATION.

USING FUTURES TO HEDGE AGAINST CORONAVIRUS (COVID-19) RISKS MARCH 9, 2020 by DANIELS TRADING | Tips & Strategies The new year brought a fundamental market driver seldom seen in the world of finance: a global viral outbreak. The onset of the novel coronavirus, officially labeled COVID-19 by the World Health Organization (WHO), sent a shockwave through the equity, commodity, currency, and debt markets. Although the immediate reaction to the novel coronavirus was muted, the final impact was devastating. For astute traders, using futures to hedge against risks posed by the coronavirus became a priority. Whether navigating the late-February stock market crash or commodity market volatility, futures were an ideal way of staying one step ahead of the erupting pandemic. Market Impact of the 2020 Coronavirus Outbreak When the coronavirus outbreak was confirmed on Jan. 7, 2020, its international impact was projected to be negligible. The Chinese government took aggressive steps to contain the virus, quarantining the origin city of Wuhan and surrounding areas. Unfortunately, the efforts proved ineffective. By the end of February, confirmed cases numbered more than 82,000 globally, with at least 2,800 fatalities. During the lead-up to the Feb. 24 trading week, traders and investors addressed the COVID-19 outbreak with skepticism. Asset pricing volatility fell within "normal bounds," and few professional traders thought of using futures to hedge their exposure. However, after reports of widespread breakouts in Iran, Italy, and South Korea became public ahead of the trading session on Monday, Feb. 24, the financial markets South Korea became public ahead of the trading session on Monday, Feb. 24, the financial markets descended into chaos. Here are the key financial events that transpired between the Monday, Feb. 24 open and the Thursday, Feb. 28 close: U.S. equities dropped from near all-time highs into corrective territory. As of the Thursday, Feb. 27, 2020 Wall Street close, the Dow Jones Industrial Average (-2636.29,-9.3%), S&P 500 (-279.22, -8.5%), and NASDAQ (-618.63, -6.8%) all posted massive four-day losses. U.S. 10-Year Treasuries saw yields dip beneath 1.25% for the first time in history. April West Texas Intermediate (WTI) crude oil futures fell by more than $6.00 per barrel, beneath December 2018's low ($45.92). Agricultural commodities struggled to find solid ground. Losses sustained in May corn (-12'6, -3.35%) and April live cattle (-7.775, -6.58%) paced the decliners. To most traders, using futures to hedge means buying gold. For this period of market tumult, the strategy proved ineffective. Although volatile, April gold futures traded largely flat (-0.60, -0.07%). Using Futures to Hedge Against Coronavirus Fears As the old saying goes, hindsight is 20/20. In the case of the panic-selling sparked by the COVID-19 epidemic, this is certainly true. However, using futures to hedge can help traders and investors proactively manage risk. Here are a few ways that futures could have been used to protect market share amid the coronavirus outbreak: Equities: Futures products offer an abundance of options in the arena of portfolio diversification. For instance, opening a short position in a deferred-month Micro E-mini or E-mini S&P 500, Nasdaq, or DOW futures contract greatly limits exposure to downside risk. In the event of a coronavirus-type stock market plunge, gains generated from active shorts may be used to offset losses taken by traditional equities positions. Agricultural commodities: A good marketing plan includes a strategy to manage unforeseen risk. In the case of corn or live cattle producers, the COVID-19 outbreak brought an abundance of weakness to asset pricing. For U.S. corn producers, selling harvest-time September or December corn futures contracts provides insulation from catastrophe. Cattle producers deal with a more complex scenario. However, limiting the fallout from the coronavirus was as simple as selling June, August, or October live cattle futures. Active shorting is only one way of using futures to hedge against downside pricing risks. There are countless others, each designed to protect your hard-earned wealth from the unknown. USING FUTURES TO HEDGE AGAINST CORONAVIRUS (COVID-19) RISKS MARCH 9, 2020 by DANIELS TRADING | Tips & Strategies The new year brought a fundamental market driver seldom seen in the world of finance: a global viral outbreak. The onset of the novel coronavirus, officially labeled COVID-19 by the World Health Organization (WHO), sent a shockwave through the equity, commodity, currency, and debt markets. Although the immediate reaction to the novel coronavirus was muted, the final impact was devastating. For astute traders, using futures to hedge against risks posed by the coronavirus became a priority. Whether navigating the late-February stock market crash or commodity market volatility, futures were an ideal way of staying one step ahead of the erupting pandemic. Market Impact of the 2020 Coronavirus Outbreak When the coronavirus outbreak was confirmed on Jan. 7, 2020, its international impact was projected to be negligible. The Chinese government took aggressive steps to contain the virus, quarantining the origin city of Wuhan and surrounding areas. Unfortunately, the efforts proved ineffective. By the end of February, confirmed cases numbered more than 82,000 globally, with at least 2,800 fatalities. During the lead-up to the Feb. 24 trading week, traders and investors addressed the COVID-19 outbreak with skepticism. Asset pricing volatility fell within "normal bounds," and few professional traders thought of using futures to hedge their exposure. However, after reports of widespread breakouts in Iran, Italy, and South Korea became public ahead of the trading session on Monday, Feb. 24, the financial markets South Korea became public ahead of the trading session on Monday, Feb. 24, the financial markets descended into chaos. Here are the key financial events that transpired between the Monday, Feb. 24 open and the Thursday, Feb. 28 close: U.S. equities dropped from near all-time highs into corrective territory. As of the Thursday, Feb. 27, 2020 Wall Street close, the Dow Jones Industrial Average (-2636.29,-9.3%), S&P 500 (-279.22, -8.5%), and NASDAQ (-618.63, -6.8%) all posted massive four-day losses. U.S. 10-Year Treasuries saw yields dip beneath 1.25% for the first time in history. April West Texas Intermediate (WTI) crude oil futures fell by more than $6.00 per barrel, beneath December 2018's low ($45.92). Agricultural commodities struggled to find solid ground. Losses sustained in May corn (-12'6, -3.35%) and April live cattle (-7.775, -6.58%) paced the decliners. To most traders, using futures to hedge means buying gold. For this period of market tumult, the strategy proved ineffective. Although volatile, April gold futures traded largely flat (-0.60, -0.07%). Using Futures to Hedge Against Coronavirus Fears As the old saying goes, hindsight is 20/20. In the case of the panic-selling sparked by the COVID-19 epidemic, this is certainly true. However, using futures to hedge can help traders and investors proactively manage risk. Here are a few ways that futures could have been used to protect market share amid the coronavirus outbreak: Equities: Futures products offer an abundance of options in the arena of portfolio diversification. For instance, opening a short position in a deferred-month Micro E-mini or E-mini S&P 500, Nasdaq, or DOW futures contract greatly limits exposure to downside risk. In the event of a coronavirus-type stock market plunge, gains generated from active shorts may be used to offset losses taken by traditional equities positions. Agricultural commodities: A good marketing plan includes a strategy to manage unforeseen risk. In the case of corn or live cattle producers, the COVID-19 outbreak brought an abundance of weakness to asset pricing. For U.S. corn producers, selling harvest-time September or December corn futures contracts provides insulation from catastrophe. Cattle producers deal with a more complex scenario. However, limiting the fallout from the coronavirus was as simple as selling June, August, or October live cattle futures. Active shorting is only one way of using futures to hedge against downside pricing risks. There are countless others, each designed to protect your hard-earned wealth from the unknown