Question
The Ottawa Precious Metals Corporation mines (produces) and sells silver. The firm plans to produce and sell several tons of silver next year but is
The Ottawa Precious Metals Corporation mines (produces) and sells silver. The firm plans to produce and sell several tons of silver next year but is concerned about price volatility in the silver market. Which of the following is a valid strategy for hedging this exposure?
| a. | Hold (buy) put options on silver |
| b. | Hold (buy) call options on silver |
| c. | Write (sell) put options on silver |
| d. | Write (sell) call options on silver |
| e. | None of the above |
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Finance For Executives Managing For Value Creation
Authors: Gabriel Hawawini, Claude Viallet
2nd Edition
0324117752, 9780324117752
