Which of the following describes tailing the hedge?
A. A strategy where the hedge position is increased at the end of the life of the hedge
B. A strategy where the hedge position is increased at the end of the life of the futures contract
C. A more exact calculation of the hedge ratio when forward contracts are used for hedging
D. None of the above
D
Tailing the hedge is a calculation appropriate when futures are used for hedging. It corrects for daily settlement
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Indicate whether the statement is true or false
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Answer the following statement true (T) or false (F)