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CTP · Question #52
(Topic 1) Which of the following would be MOST suitable for a risk-averse electronics manufacturer that uses copper in many of its components?
The correct answer is D. A costless collar using options on copper futures. See the full explanation below for the reasoning.
Question
- (Topic 1)
Which of the following would be MOST suitable for a risk-averse electronics manufacturer that uses copper in many of its components?
Options
- BA short position in copper futures
- CA floor option on copper futures
- DA costless collar using options on copper futures
How the community answered
(35 responses)- B17% (6)
- C11% (4)
- D71% (25)
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