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A steak house takes a long position on cattle futures to limit its risk in the case of a cattle price increase.

A steak house takes a long position on cattle futures to limit its risk in the case of a cattle price increase. Six months later the steak house wants to eliminate its obligation under this position before the futures contracts expire. What should the steak house do?

Question 12 options:


Buy Cows


Sell cows in the spot market. 


Deliver Cows to the Chicago Board of Trade


Take a short cattle futures contract position to offset the long position


Sell the long futures contracts. 

Top Answer

Option E :- Sell... View the full answer

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