Question: Course: Financial modeling in Excel Question: You are working for a bank and one of your customers wants to buy 2000 contracts of European Call

Course: Financial modeling in Excel Question: You are working for a bank and one of your customers wants to buy 2000 contracts of European Call options on Tesla with a strike price equal to 200 and maturity of 2 months. The annual risk interest rate is 3% and the implied volatility is 62%. Generate 300 daily datapoints for the underlying stock choosing an appropriate distribution. You are asked to hedge your short option position and highlight what would be your performance as you increase the hedging frequency from weekly to daily to hourly. How frequently should you hedge? -You should comment several steps so that your results are reproducible -You should think critically about your results and briefly discuss (in Excel) limitations and suggestions that could improve the analysis

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