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+--- Thread: Hedging ? (/showthread.php?tid=2750)
Hedging ? - Ice_Blue - 12-26-2005
what is hedging ?
Ice Blue
- maani - 12-27-2005
Hi,
hedging means reducing the risk of loss involved in holding an investment(specially in case of shares).you know whenever someone holds the shares of a company there is chance that the market prices of these shares will fall/rise...if market prices will fall in the future (below holders purchase price) there will be a risk of loss for the investor...to reduce this risk different method are adopted called "hedging"...
in other words you can say that hedging is a type of insurance particular to investment in shares...
Ace
- Ice_Blue - 01-06-2006
thanks indeed
Ice Blue
- satti2die4 - 01-27-2006
well!!!
hedging refers to offsetting a potential position by traking alternative measures <which are many>.so you can see that in hedging we have information about our present position(a potential risk which everybody calls exposure;i dont agree with this term> & what we do is that we neutralize/protect our present position by taking a present decsion.if we take a future position about our financial conditions we are speculating <such as india will loose at sharjah n Pak will win>
its not over baby.......
round n round it goes where it stops nobody knows...
regards
ahsan satti
- derivativetrader - 02-15-2006
<blockquote id="quote"><font size="1" face="Verdana, Tahoma, Arial" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Ice_Blue</i>
<br />
what is hedging ?
Ice Blue
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
Please have a look on this article - it should clear your concept.
http//www.finpipe.com/hedge.htm