Question: There are three parts for this question a. Explain why trading futures is very risky. You can center your discussion on leverage and margin. b.

There are three parts for this question a. Explain why trading futures is very risky. You can center your discussion on leverage and margin. b. Discuss why it is highly risky when using options as an investment vehicle. You might find the following data for a call option useful for your discussion: So = 49, K = 59, r = 5%, 7 = 0.38,o = 20%, call option price c = 1.4, A- = 0.52, c. Briefly discuss the advantages and disadvantages when using futures and options for hedging systematic risk

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