in question 1, to cslculate beta of portfolio of 1.27 the answer given was the return on short position: -25 x (119347-124450)/20,000,000 what is the -25 ? tx
Number of future contracts you are selling hence payoff: -#future contracts (Current price - purchase price).
I just did that question. The 25 is right before December read carefully. 25 December. Pretty stupid and unclear, I don’t think it’s going to be like that on the exam.
i am still lost…i thought that 25 is a date? i mean dec 25? how to calculate to get -25 pardon my stupidity. thanks a lot
No your not stupid… A lot of us thought it was Dec. 25. But in reality… it meant 25 December Contracts. -25 is shorting. That part was just poorly written.
haaaaaa omg… ok thanks thanks all