You hold a stock portfolio worth 30million with a beta of 1.05. You would like to lower the beta to 0.90 using S&P 500 futures, which have a price of 460.20 and a multiplier of 500. What transaction should you do?

A. Sell 130 contract

B. Sell 9778 contract

C. Sell 20 contract

D. Buy 50,000 contract

Find the optimal hedge ratio if the portfolio is worth 2,400,000 the beta is 1.15 and the S&P price is 450.70 with a multiplier of 500

A. 10.65

B. 12.25

C. 6123.80

D. 5325.05