Skip to main content
Options and Futures

Purchasing Hedge or Long Hedge

In order to safeguard against potential price hikes in the future, investors often turn to purchasing futures contracts for cash commodities. This involves buying contracts for the same amount and type of commodities that are expected to be bought in the future. This practice, also known as a buying hedge, is a form of hedging that helps mitigate risks associated with fluctuating market prices. By closing the futures position at the time of purchase, investors can protect themselves from potential losses and ensure a more stable financial position.

Related terms

Pulpit

Understand the meaning and definition of Pulpit in the context of stock market, trading, and investments.

MORE
Option Buyer

Understand the meaning and definition of Option Buyer in the context of stock market, trading, and investments.

MORE
Time-Stamp

Understand the meaning and definition of Time-Stamp in the context of stock market, trading, and investments.

MORE
Linkage

Understand the meaning and definition of Linkage in the context of stock market, trading, and investments.

MORE
Closing Purchase

Understand the meaning and definition of Closing Purchase in the context of stock market, trading, and investments.

MORE
Floor Trader (FT)

Understand the meaning and definition of Floor Trader (FT) in the context of stock market, trading, and investments.

MORE

Open Free Demat Account!

Join our 3.8 Cr+ happy customers

+91
Explore other categories
Enjoy Zero Brokerage on Equity Delivery
10 Cr+DOWNLOADS

Enjoy Zero Brokerage On Stock Investments

Get the link to download the App

Scan this QR code to download the app
Get it on Google PlayDownload on the App Store

Open Free Demat Account!

Join our 3.8 Cr+ happy customers
+91