Question: Problem 1 4 - 1 7 Cross - Hedging ( LO 4 , CFA 2 ) You have been assigned to implement a three -

Problem 14-17 Cross-Hedging (LO4, CFA2)
You have been assigned to implement a three-month hedge for a stock mutual fund portfolio that primarily invests in medium-sized
companies. The mutual fund has a beta of 1.34 measured relative to the S&P Midcap 400, and the net asset value of the fund is $174
million.
a. Should you be long or short in the Midcap 400 futures contracts?
Short
Long
Problem 14-17 Cross-Hedging (LO4, CFA2) You have been assigned to implement

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