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The answer is C please explain why! You are a producer of a commodity. Which of the following hedging strategies will make money if commodity
The answer is C please explain why!
You are a producer of a commodity. Which of the following hedging strategies will make money if commodity spot price settles at $120?
a. Buy a put option with strike of $100 and premium $2.50
b. Sell a swap at $100
c. Buy a put option with a strike of $50 and premium $0.15 and sell a call option with a strike $150 and premium $0.25
d. Write a call option with a strike $100 and premium $.50
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