When the hedge ratio is adjusted in the binomial model,the transactions must be done in the option.

Name: When the hedge ratio is adjusted in the binomial model,the transactions must be done in the option.
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In the binomial model, adjusting the hedge ratio typically involves transactions in the underlying asset, not necessarily in the option itself. The hedge ratio determines the proportion of the underlying asset to be bought or sold to hedge the option position.

When the Hedge Ratio Is Adjusted in the Binomial Model,the