Jack Goodwin recently read an article on the use of futures contracts on individual stocks for hedging purposes. He spent about 500 shares of Abbott Laboratories in its trading book. At the time, he was concerned about the fall of the share price in the short term, he was optimistic about the long-term. Of course, he could sell now and buy later, but it will mean that it will have taxable capital gains, which he wanted to avoid. He believes that one stock futures contracts offered on OneChicago exchange may be the possibility to hedge price risk. "Hide
by Robert M. Conroy Source: Darden School of Business 8 pages. Publication Date: December 28, 2011. Prod. #: UV5638-PDF-ENG
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