Question
True or False: This question has 5 parts: a) the slope coefficient computed by regressing a particular stock's historical returns on the s&p 500 returns
True or False:
This question has 5 parts:
a) the slope coefficient computed by regressing a particular stock's historical returns on the s&p 500 returns is called beta,the stock's beta with respect to the s&p 500 index; beta is important in finding variance-minimizing hedged portfolis.
b)a swap provides a means for replacing a stream of uncertain and variable payments with a fixed, non-variable payment stream that is certain.
c)the zero-cost collar options trading strategy involves buying a call option and selling a put option on the same stock with the same expiration date, same premium, and a higher strike price than the call option.
d)suppose you go long 10 Eurodollar futures contracts at price of 97. when the futures contracts settle at expiration, 3-month LIBOR is 1%.j ignoring commissions and margin interest, your position results in a $50,000 loss.
e)the current u.s. dollar/Chinese yuan currency spot rate is $0.13 per yuan. the fair value price for the U.S. dollar /Chinese yuan exchange rete for a 2-year forward contract is $0.1408. If the U.S. dollar denominated annual interest rate is 6%, the Chinese yuan-denominated annual interest rate must be 3%.
u can just answer true or false, but if u can simply explain why, It will be better. thank you
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