Long Hedge

Posted in Finance, Accounting and Economics Terms, Total Reads: 684

Definition: Long Hedge

Long Hedge is when an investor takes long position in futures contracting so as to combat the volatile nature of the prices.

It provides a lock in (a profitable stage resulting out of selling) on a particular asset.

It has been a tool of the exporters to safeguard the price rise. This practise is a must for firms which have set eyes on purchasing some assets in near future. As soon as the value exceeds the required value the utilization can be made at the spot price.

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