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Question A traders portfolio is delta neutral and has a gamma of -4,250. The delta and gamma of a particular traded call option are 0.62

Question A traders portfolio is delta neutral and has a gamma of -4,250. The delta and gamma of a particular traded call option are 0.62 and 1.52, respectively. The trader wants to make the portfolio gamma neutral as well as delta neutral.

1.1 What position should the trader take. 1.2 Explain to the trader what protection delta and gamma neutrality can provide to his portfolio.

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