Can someone help me understand the general Cash Flow from this Example? On page 100 - V5 CFAI, Exhibit 3 - the company wants to adjust its Beta t0 1.1 from 0.9. Using the formula: [(Bt - Bp) / Bf] *[S/f] Bt= 1.0 Bp = 0.90 Bf = 0.95 S = $38,500,000 f = $275,0000 Company should buy 29 contracts to adjust its Beta from .90 to 1.1. Question: • 29 contracts would be how much money? Is there any cash flow up front? (My guess is no… there is no cash up front on a futures contract, right?) How does the cash flow on this work? Time 0 to Time T (when they close it out)? I assume the answer to this also applies to the Duration adjustment as well.