It is May 2021 and a corporate treasurer is due to issue 3-year, 5% coupon bonds in one month. Which one of the following hedging strategies may be appropriate to implement during May to manage the risk of an interest rate rise?
Select one:
A.Sell 10-year bond futures with contract expiry in June 2021
B.Sell 3-year bond futures with contract expiry in June 2021
C.Buy 10-year bond futures with contract expiry in June 2021
D.Buy 3-year bond futures with contract expiry in June 2021
