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Vega hedging with the Black-Scholes-Merton model is not a reasonable practice because... Volatility is assumed to be constant. The transactions costs are too high. Past
Vega hedging with the Black-Scholes-Merton model is not a reasonable practice because...
Volatility is assumed to be constant.
The transactions costs are too high.
Past volatility is a good predictor of future volatility.
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