The price of a cheapest-to-deliver future = contract price / conversion factor
So, that’s the reason why we multiply our hedge formula with the conversion factor if we have the price of a chepeast-to-deliver future?
Thanks.
The price of a cheapest-to-deliver future = contract price / conversion factor
So, that’s the reason why we multiply our hedge formula with the conversion factor if we have the price of a chepeast-to-deliver future?
Thanks.