ACI
3I0-012 · Question #443
If a dealer needs to hedge an over-lent 3x6 position against 1MM dates for which the FRA is quoted 1.30-1.34% and futures at 98.64, which would be cheapest for him (ignoring margin costs on futures…
The correct answer is A. FRA. See the full explanation below for the reasoning.
Question
If a dealer needs to hedge an over-lent 3x6 position against 1MM dates for which the FRA is quoted 1.30-1.34% and futures at 98.64, which would be cheapest for him (ignoring margin costs on futures positions) to cover his gap?
Options
- AFRA
- BFutures
- CNo difference
- DToo little information to decide
How the community answered
(50 responses)- A84% (42)
- B4% (2)
- C10% (5)
- D2% (1)
Community Discussion
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