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CFA Level 3
Derivatives & Currency Mgmt

Hedging Against Euro Decline

Medium Derivative Strategies Hedging Strategies

Maria is a portfolio manager overseeing a diversified fund with significant exposure to European equities. She is concerned about potential declines in the euro relative to the US dollar as geopolitical tensions escalate in Europe. Maria decides to implement a hedging strategy to protect the value of her portfolio.

Which of the following strategies would most effectively hedge against the risk of a declining euro?

Hint

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