Determine the number of futures contracts needed for this


A company needs to hedge the purchase of 1 million units of asset A in two months using 3-month futures on a similar asset B. The futures contract size is 4000 units of the asset B. The following are historical data on the changes of the spot price of asset A and the changes of the futures price of asset B in two-month periods. Determine the number of futures contracts needed for this hedge.

spot price change: 0.50 0.61 -0.22 -0.35 0.79 0.04 0.15 0.70 -0.51 -0.41  

futures price change: 0.56 0.63 -0.12 -0.44 0.60 -0.06 0.01 0.80 -0.56 -0.46

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Financial Management: Determine the number of futures contracts needed for this
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