Hedge

Risk management.

1. Noun.

An instrument or position which is entered into to offset the adverse effects of changes in the value of another instrument or position already committed or expected.

2. Verb.

To create a hedging position.

See also

• Cash flow hedge
• Collar hedge
• Dealer
• Delta hedge
• Fair value hedge
• Hedge accounting
• Hedge effectiveness
• Hedge fund
• Hedge ratio
• Hedging
• Longevity hedge
• Risk management
• Wrong way risk