What kind of futures hedge would be appropriate in each of the following situations?   a. A bank fears that rising deposit interest rates will result in losses on fixed-rate loans? b. A bank holds a large block of floating-rate loans and market interest rates are falling? c. A projected rise in market rates of interest threatens the value of the bank's bond portfolio?

Essentials Of Investments
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Chapter1: Investments: Background And Issues
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What kind of futures hedge would be appropriate in each of the following situations?

 

a. A bank fears that rising deposit interest rates will result in losses on fixed-rate loans?

b. A bank holds a large block of floating-rate loans and market interest rates are falling?

c. A projected rise in market rates of interest threatens the value of the bank's bond portfolio?

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