SIE - Securities Industry Essentials Exam
A hedge fund manager that is long large cap US stocks in the fund's portfolio may hedge his risk by
Selling S&P 500 index callsA
Buying S&P 500 index putsB
Buying Russell 2000 index putsC
Selling Russell 2000 index callsD
The S&P 500 is the broadest measure of the American economy and contains all large cap stock. Buying puts can hedge the long stock fund's risk in its portfolio.