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Which of the following is not an insurance strategy against decrease in underlying asset price? A....

Which of the following is not an insurance strategy against decrease in underlying asset price?

A. Long put
B. Floor
C. Long forward
D. Short call

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Answer #1

Long forward is not an insurance strategy against decrease in underlying asset price.

Derivative contracts can be of different types:
– Futures
– Options
– Swaps
– Caps
– Floor
– Collars etc.
The most popular derivative instruments are futures and Options.

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