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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Over/ Under hedge
Sir I have 2 Questions
(1) When solving the sum using the lock in rate, we use the lock in rate and not the exercise price to calculate no of contracts. right?
(2) Unless the question specifies the contract to be rounded to the nearest whole number (like in Gogarth), can I always under hedge? example if contracts come to 5.8, can I take 5 and then hedge the remaining using forward/spot rate rather than taking 6 ( As I find it quick to deal with under hedging)???
Yes to both 🙂 🙂
Thanks a lot
You are welcome 🙂