What Is a Hedge?
A hedge is an investment that is made with the intention of reducing the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting or opposite position in a related security.
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A perfect hedge is one that eliminates all risk in a position or portfolio. In other words, the hedge is 100% inversely correlated to the vulnerable asset. This is more an ideal than a reality on the ground, and even the hypothetical perfect hedge is not without cost. Basis risk refers to the risk that an asset and a hedge will not move in opposite directions as expected; "basis" refers to the discrepancy.
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In our previous educational post we noticed that you really liked this theme. The most pressing question in the comments was, what cryptocurrency is able to hedge the rest. So we made a short research to find and provide this table for you, guys. Here is the list of these cryptos that may safe your wallet from being bankrupt.
This is not the financial advice to buy some of these coins or something like this.
It is just a short material that all the crypto traders should follow before entering into the trade.
_______________________________________________
All the materials were taken from Binance and Bitmex open sources
We are glad to share all the materials with this community.
Feel FREE to leave comments below about your vision
Thank you, wolves🔥
A hedge is an investment that is made with the intention of reducing the risk of adverse price movements in an asset. Normally, a hedge consists of taking an offsetting or opposite position in a related security.
_______________________________________________
A perfect hedge is one that eliminates all risk in a position or portfolio. In other words, the hedge is 100% inversely correlated to the vulnerable asset. This is more an ideal than a reality on the ground, and even the hypothetical perfect hedge is not without cost. Basis risk refers to the risk that an asset and a hedge will not move in opposite directions as expected; "basis" refers to the discrepancy.
_______________________________________________
In our previous educational post we noticed that you really liked this theme. The most pressing question in the comments was, what cryptocurrency is able to hedge the rest. So we made a short research to find and provide this table for you, guys. Here is the list of these cryptos that may safe your wallet from being bankrupt.
This is not the financial advice to buy some of these coins or something like this.
It is just a short material that all the crypto traders should follow before entering into the trade.
_______________________________________________
All the materials were taken from Binance and Bitmex open sources
We are glad to share all the materials with this community.
Feel FREE to leave comments below about your vision
Thank you, wolves🔥
