You are in charge of the bond portfolio of TIAA-CREF and currently manage a portfolioworth$150 billion in T-bonds. You want to liquidate your portfolio on or after October 2, 2021 and on or before December 31, 2021 your retirement date. You decide touse T-bond futures contract to set up a hedge, if at all. Currently, January 2022 T-bond futures are 95-15. On October 2, 2021 the average duration of TIAAs targetedbond portfolio will be 11.9 years. The cheapest to deliver T-bond futures January 2022contract expected to be 17 years, 8% coupon bond whose duration is 10.8 years atmaturity of the futures contract. Explain carefully which risk you are exposed to if youdo not set up the hedge. Separately consider the scenarios where interest rate rises anddeclines. Demonstrate the size and direction of a position in January 2021 Treasurybond futures that would provide a hedge for the underlying TIAAs bond portfolio.