Question 6
i) What does vega measure? What can
you tell from vega value? Can the vega of a derivatives portfolio
be changed by taking a position in the underlying asset? Explain.
ii) What are advantages of futures
options over spot options?
iii) What a company should do to hedge
foreign currency that will be received or paid? Explain.
If possible, please provide a detailed
explanation as I understand the gist of it but would like a full
understanding and...