Vidyalelo
Management · Q32

International Finance and Treasury

Graduate and Post Graduate · Management · question 32

Q32

The cost of hedging through option includes

A.
Option premium
B.
Interest on option premium till due date of the contract
C.
Both a and b
Answer
D.
optimum premium and difference between option price and spot price

Answer: Option C

Solution

Answer: Option C
Solution:
The cost of hedging through option includes Option premium and Interest on option premium till due date of the contract.