Options and FuturesSupply, Law of Price Limit Order Runners Pit Cash Contract Underlying Futures Contract
Selling Hedge or Short Hedge
In the realm of finance, it is common practice for individuals to sell futures contracts as a form of protection against potential price declines of commodities that will be sold in the future. This strategy involves closing the open futures position by purchasing an equal number and type of contracts at the time the cash commodities are sold. This approach, known as hedging, serves as a safeguard against potential losses and is a valuable tool in risk management.
Related terms
Understand the meaning and definition of Supply, Law of in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Price Limit Order in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Runners in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Pit in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Cash Contract in the context of stock market, trading, and investments.
MOREUnderstand the meaning and definition of Underlying Futures Contract in the context of stock market, trading, and investments.
MOREExplore other categories
4.4 Cr+DOWNLOADS
Enjoy Zero Brokerage On Stock Investments
Get the link to download the App
