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  1. B

    Managing Risk on Balance Sheet

    An FI has DA= 2.45 years and kDL= 0.97 years. The FI has total assets equal to $375 million. The FI wishes to effectively reduce the duration gap to one year by hedging with T-Bond futures that have a market value of $115,000 and a DFut= 8 years. How many contracts are needed and should the FI...
  2. B

    Options

    yes that is why i was confused with the question.
  3. B

    Options

    A stock has a spot price of $55. Its May options are about to expire. One of its puts is worth $5 and one of its calls is worth $10. The exercise price of the put must be __________ and the exercise price of the call must be ____________. The answer is $60 and $50 respectively. Anyone knows the...
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