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Explain critically how the volatility and amount of future dividends might affect the price of...

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Accounting

Explain critically how the volatility and amount of future dividends might affect the price of a stock option (European call and put; American call and put). For a hedger who wants to keep the upside potential open while minimising the downside risk, which one between long futures and call option you are going to recommend? Discuss each of the alternatives and justify your recommendation.

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