The question asks for a Hedging portfolio, using the value of delta found in (iii) 0.5350 as the proportion of Stock per unit of the portfolio/call option gives stock = 5, 350 shares. However the solution finds the cash by saying (5,300 - 21,400) = -17, 300. Where does this 21,400 come form???
The number of shares needed to hedge the call = 10,000 x delta(call) = 5,350 Value of these shares = number of shares x share price = 5,350 x 400p = £21,400
