medium · FRM Part 1
Which of the following is an example of 'rollover risk' in a hedging program?
- The risk that the price of the asset will roll back to its original price after a move.
- A hedger must close a maturing futures position and enter a new one because the hedge horizon is longer than the contract's life.
- The risk that a long position will be rolled into a short position accidentally.
- The risk that the exchange will roll back trading due to high volatility.
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