Explain why the Pernellis’ would want to use market-index futures to hedge their share portfolio, and note how they would go about setting up such a hedge. Be specific. a. What alternatives do Jim and...

Explain why the Pernellis’ would want to use market-index futures to hedge their share portfolio, and note how they would go about setting up such a hedge. Be specific.

a. What alternatives do Jim and Polly have to protect the capital value of their portfolio?

b. What are the benefits and risks of using market-index futures for such purposes (as hedging vehicles)?