What the term hedge or hedging refers to when it comes to the financial industry, is it’s a mechanism which offsets or neutralizes financial risk. What needs to be understood, are the reasons and the circumstances to hedge an asset.
Originally, the Futures and Commodity Markets as we know it today, these exchanges were originally developed to hedge commodity products.
The purpose of the Futures Market, established in the early 1800’s, was designed to insulate and protect the farmers during that time, from the risk of adverse price swings in …
