What is a Hedge?

[ismed]

It is a strategy that can be used by the forex market, but it does not make much sense for the use of these products, but it is also important that we will be able to send a message to each other about how to use it. If you do not know how to apply for an application, then you will be able to use the same strategies as you would like to be able to manage your business. untuk pemula atau terampil Because of the strategies of the system, it has been suggested that the system may be used as an intermediary in the system.

[setan]

Thank you the truth I do not know the hedging strategy well and this Ptarifkm really benefited very visible as I was a successful strategy I prefer to rely on technical analysis as Fu's analysis is very much in line with the strategy developed by me and hope to realize good profits, because I always lose In forex online trading hedgeing is a technical point where we stop our losses. This technique that we can sell and buy in one point and we cover our losses. I think if you use this technique so we can stable long in trading

[kamcah]

For some people who are considered Hedging is one powerful enough way to make a profit but to restore the tactics, strategies and the way his name will always be an inherent risk. Most merchants may choose to keep a hedge position or lock in our losses. One of the disadvantages is that long-term hedging, demanding calculations and quicker metaphysics, can affect our psychological requirements for impatient people. As a result, we can actually be trapped minus bigger points. Hedge in fx means managing or even causing danger. A much more sophisticated off-set state can define a hedge as an ownership associated with a technical or even industry type that gives you a cost-appropriate motion by way of compensation for profit

[ch tayyab]

Hedge


What it is:

In finance, a hedge is a strategy intended to protect an investment or portfolio against loss. It usually involves buying securities that move in the opposite direction than the asset being protected.

How it works (Example):

Let's assume part of your investment portfolio includes 100 shares of Company XYZ, which manufactures autos. Because the auto industry is cyclical (meaning Company XYZ usually sells more cars and is more profitable during economic booms and sells fewer cars and is less profitable during economic slumps), Company XYZ shares will probably be worth less if the economy starts to deteriorate. How do you protect your investment?

One way is to buy defensive stocks. These stocks might be from the food, utility, or other industries that sell productsThe definition of hedge on InvestingAnswers that consumers consider basic necessities. During economic slumps, these stocks tend to gain or at least hold their value. Thus, these stocks may gain when your XYZ shares lose.

#-ad_banner-#Another way to hedge is to purchase a put option contract on the shares (this would essentially allow you to "lock in" a particular sale price on XYZ, so even if the stock crashed, you wouldn't suffer much). You could also sell a futures contract, promising to sell your stock at a set price at a certain point in the future.
Why it Matters:

Hedging is like buying insurance. It is protection against unforeseen events, but investors usually hope they never have to use it. Consider why almost everyone buys homeowner's insurance. Because the odds of having one�s house destroyed are relatively small, this may seem like a foolish investment. But our homes are very valuable to us and we would be devastated by their loss. Using options to hedge your portfolio essentially does the same thing. Should a stock or portfolio take an unforeseen turn, holding an option opposite of your position will help to limit your losses.

Portfolio hedging is an important technique to learn. Although the calculations can be complex, most investors find that even a reasonable approximation will deliver a satisfactory hedge. Hedging is especially helpful when an investor has experienced an extended period of gains and feels this increase might not be sustainable in the future. Like all investment strategies, hedging requires a little planning before executing a trade. However, the security that this strategy provides could make it well worth the time and effort

[kades]

I agree with you for the purpose of using the Forex trading strategy to reduce losses with the goal of being obliged to be mastered in order to understand all with the intention of getting something done in order to earn money trading Forex concern management. , not as a problem with no problem in assets, it is very exciting to beat the bushes that certainly learn from experience will help the luck to our trading ability in the future Forex trading is a risky, and hedging is one way that can help traders to minimize the amount the risks they take. So much for traders like money and risk management, and having other tools like hedging in a barn like this is very useful.

[mrinalini]

hedging or combination between buy and sell at a same time with same amount of lots won't give us any profits. I think traders that use hedging strategy also use correlation between some pairs. I have seen some strategies like that, some pairs has connected and have antipodes movements so we can do hedging and take both opportunity.

As you have mentioned that hedging is both buy and sell at same price so one can not make profits in both the trades and eventually one trade has to be closed after you make sure of the trend and or decide any one to close based on your analysis and then you let one trade run . It is better to open one trade based on proper analysis and hedging can be done sometimes when wrong trade is opened or markets are volatile and there are great pip movements .

[amnajamil01]

Hedge is a trading strategy .Hedging is very useful trading technique. It prevents us from a very big loss and also lock our little profit. Often i want to do hedging but fails. Hedging is not so easy and simple.

[adalah]

Hedging is one way to manage the strategies used by traders where they start both organizations buying in the same currency trading by working multiple at the same stage. This is one way of risk management that must be used by traders who are aware of the cost activity. Hedge is a way to trade in that, you just trade and you know it will give you a loss, you can trade in the same direction in the hope that I will make a profit

[Bengt]

I don't use hedge and don't understand what the use of ot is. Hedge is opening of a deal with the same tool, but with an opposite trend. For example, you buy euro to hedge or "to lock" as it's also said, and you need to open a deal to sell the euro. as a result you have two deals compensating one another and keeping the balance. Isn't it easier to leave the deal then? You'll get the same results, but with 100% guarantee that there won't be any unexpected things woth your lock.

[gedefx29]

hedging or combination between buy and sell at a same time with same amount of lots won't give us any profits. I think traders that use hedging strategy also use correlation between some pairs. I have seen some strategies like that, some pairs has connected and have antipodes movements so we can do hedging and take both opportunity.