Hedging with Futures

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  • čas přidán 5. 09. 2024

Komentáře • 10

  • @jonasherman9195
    @jonasherman9195 Před 2 lety

    Great video!

  • @sisasavannahcat2978
    @sisasavannahcat2978 Před 4 lety

    Great video !!

  • @ricklavie7315
    @ricklavie7315 Před 4 lety

    Excellent

  • @ppietras97
    @ppietras97 Před 3 lety

    This video is basically 1 + (-1) = 0, but in more complex terms.. you have no real application

    • @RonaldMoy
      @RonaldMoy  Před 3 lety +12

      That's exactly what hedging is. You're not trying to maximize profits, but to reduce risk. Sometimes you want to lock in a gain or a price. Suppose you have a stock that has risen a lot, and you'll use the proceeds for a downpayment on a house in March. It's November and you could sell now, but then you'd have to pay the capital gains tax in April. If you sell in January, you can postpone the taxes for a year. You're worried the price might fall in the next 2 months so you hedge.

    • @bhavikshah5016
      @bhavikshah5016 Před 2 lety +5

      ​@@ppietras97 As Ronald mentioned hedging is not about making profits, but covering your risk so that you don't loose money. To loose or make money is speculative trading which is opposite of hedging. In essence speculative trading is all about taking risk, while hedge is to get rid of the risk.

  • @bufuization
    @bufuization Před 4 lety +2

    useless. numbers and examples are needed.