What is a Hedge?

[sahed_a]

What is hedging?

Definition Coverage: Coverage is a trading strategy where an investor seeks to reduce the risk of a negative price movement of a commodity or currency or security owned in a market by taking a position or group of positions in other markets. He started this "coverage", established general practice, when the futures markets in late 1800 to allow protection of the efficiency of market prices of agricultural commodities. The risk mitigation process expanded over the years to include the future of high-risk currencies, precious metals, energy, and interest rates. Although futures contracts are the most popular hedging strategies, and other compounds commonly used from the front, swaps, options, insurance policies, and many types of products through the meter. An investor using this strategy, if you are unsure of what the market can do and want to protect your downside risk. Development of the foreign currency does not stop the system is necessarily in coverage, "" From This can be accomplished in the same market, but does not reduce the risk of landing. Hedge requires an analysis of costs and revenues as hedging instruments are not required to pay premiums and commissions or spreads. Generally, the investor aware of the options for selling the call option to cover the cost of buying a put option. And there are security measures to protect low and profit potential, while the call limits the mouth, and thus "ensure" the security benefits or money.

[ermaniso2011]

hedging is very powerful yet sensitive strategy.if a trader without knowledge will hedge he can loss all of his capital anytime but professionals knows how to make good profit from it.it basically works like opening opposite positions at the same time and wait for the right time to close one side and make profit from the opened one.it is a good strategy if you are receiving rebates but it requires very high discipline.you have to prefer to close your losing positions first not the winning one.and it is very hard to do it for most of the traders.

[darksaimon]

the Hedging is real serviceable trading model. It prevents us from a real big loss and also confine our younger profit. Often i deprivation to do security but fails. Equivocation is not so relaxed and ovate. Can any embody here release me any communicator from where i can get its wake less noises

[affan9011]

I want to say that a avoid is simply option two positions in word directions with the wish of making profits from both berth. However the inventiveness is also victimised by traders to confine bad trades much that the loss is stopped until they get to a punctuation where they bed that the damage leave contrary, and then they unlock the circumvent.

[ayakcalysta]

Hedge is weapon we can use it to make very good profit or it lead us to kill our balance couscous it need
people who have very good experience in this business

thanks for the information that you provide to us all. we find the information you have provided to us is very beneficial to us, and especially for the novice trader. Hedge if it is true is a good weapon for us to use in making a profit then we will also use this method. thank you

[abdillahikbal]

I know hedge is to open three members of each pair of third order there is one pair of hegemony, and this we can do if we are going in the trading losses are very detrimental to us, at this moment we are just implementing hedging strategies

to hedge my bets a new strategy requires endurance and balance and the ability to analyze the market, we will be confused by the circumstances in which market prices tend to tug each other

[abdullahmuslim]

I know hedge is to open three members of each pair of third order there is one pair of hegemony, and this we can do if we are going in the trading losses are very detrimental to us, at this moment we are just implementing hedging strategies

[moomena]

Hedge is weapon we can use it to make very good profit or it lead us to kill our balance couscous it need
people who have very good experience in this business

yes hedge is opening two trade with same lot but reverse .it.s good to save your money from lose if market reverse on you and you don't have big capital but the problem how to get out it it,s difficult and need more time to find good point to exit this problem

[hemaelsisy]

Hedge is weapon we can use it to make very good profit or it lead us to kill our balance couscous it need
people who have very good experience in this business

[tashnotashi]

Hedge Definition: A Hedge is a trading strategy whereby an investor seeks to reduce the risk of an adverse price movement on a security, commodity or currency that he owns in one market by taking a position or combination of positions in other markets. This "hedging" practice began when public futures markets were established in the late 1800s to allow for efficient price protection in the agricultural commodity markets. The risk mitigating process has expanded over the years to include futures contracts for hedging currencies, precious metals, energy, and interest rates. Although futures contracts are the most popular medium for hedging strategies, other vehicles typically used are forwards, swaps, options, insurance policies, and many types of over the counter derivative products. An investor will use this strategy if he is unsure of what the market may do and wants to protect his downside risk. Setting a forex stop-order is not necessarily considered a "hedge" since it can be accomplished in the same market, yet it does mitigate downside risk. Hedging requires a cost-benefit analysis since hedging instruments do require premiums and commissions or spreads to be paid. Typically, an investor knowledgeable in options will sell a call option to offset the cost of buying a Put option. The Put guarantees downside protection and potential for gain, while the Call limits the upside, thereby "locking in" a profit on the security or currency.

han ap bhi sahi ho or main jo hedging ka concespt rakhta houn na woh ye ha k mugh ko jo pata chal ha hedging ka matlab ek he point par buy or ek he point parr sell karna ha ek he pair ko main to yahi janta houn