You are a market maker in long-term EUR interest rate swaps. You consider hedging these 20-year swaps with either 10s or 30s but not both. To that end you run two single-variable regressions, both with changes in the 20-year EUR swap rates as the dependent variable, but one regression with changes in the 10-year swap rate as the independent variable and the other with changes in the 30-year swap rate as the independent variable. The results over the period July 1, 2009, to July 3, 2010, are given in the following table. Number of Observations 259 Independent variable Change in 10-year Change in 30-year R-squared 89.9% 96.3% Standard Error 1.105 .666 Regression Coefficients Value Std. Error Value Std. Error Constant -.017 .069 -.008 .042 Independent variable 1.001 .021 .917 .011 Read pages 171 through 180 until two-variable regression-based hedging . 1- As the swap market maker, you just paid fixed in €100 million notional of 20-year swaps. The DV01s of the 10-, 20-, and 30-year swaps are .0864, .1447, and .1911, respectively. Were you to hedge with 10-year swaps, what would you trade to hedge? And with 30-year swaps?