Question 52.5 pts

A portfolio manager has a $250 million dollar stock portfolio with a beta of 1.05. He decides he wants to target a beta of 1.15 using S&P 500 index futures. Assuming the S&P 500 index is trading at 3,030 and each futures contract represents $250 times the index, what action should he take?

Group of answer choices

Buy 33 contracts

Sell 34 contracts

Buy 46 contracts

Sell 72 contracts

Buy 80 contracts

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Question 62.5 pts

Oil refiners have been actively hedging their supply needs by buying oil futures contracts driving the futures prices above the expected future spot price. This means the oil futures market is in....

Group of answer choices

Normal contango

Normal backwardation

Normal convenience

Chaos