Perfect Hedge

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Dictionary Says

Definition of 'Perfect Hedge'

A position undertaken by an investor that would eliminate the risk of an existing position, or a position that eliminates all market risk from a portfolio. In order to be a perfect hedge, a position would need to have a 100% inverse correlation to the initial position. As such, the perfect hedge is rarely found.
Investopedia Says

Investopedia explains 'Perfect Hedge'

A common example of a near-perfect hedge would be an investor using a combination of held stock and opposing options positions to self-insure against any loss in the stock position. The cost of this strategy is that it also limits the upside potential of the stock position.
Search results for

'Perfect Hedge'

  • Sally Vs. Ulta: The Perfect Hedge?

    http://stocks.investopedia.com/stock-analysis/2009/Sally-Vs.-Ulta-The-Perfect-Hedge-SBH-ULTA-ACV-LUX-MED-PJM1022.aspx
    ... Sally Vs. Ulta: The Perfect Hedge? ... Under the surface lies the possibility for
    the perfect long/short hedge. Why don't we see which is which? ...

  • How Companies Use Derivatives To Hedge Risk

    http://www.investopedia.com/articles/stocks/04/122204.asp
    ... And again, note the annual report implies JCI has a "perfect hedge": The
    variable-rate coupons that JCI received exactly compensates for the company's variable ...

  • What is a cross hedge?

    http://www.investopedia.com/ask/answers/08/cross-hedge.asp
    ... create a cross hedge. There wouldn't be a perfect correlation, so this example
    would not provide a perfect hedge. by Chizoba Morah. ...

  • A Beginner's Guide To Hedging

    http://www.investopedia.com/articles/basics/03/080103.asp
    ... go wrong. Although risk managers are always aiming for the perfect hedge,
    it is difficult to achieve in practice. What Hedging Means ...

  • CFA Level 1 Study Guide - Alternative Investments - Hedge Fund ...

    http://www.investopedia.com/exam-guide/cfa-level-1/alternative-investments/hedge-fund-basics.asp
    ... Formulas; Hedge Funds. Insurance; Investor Relations; Laws & Regulations; Mutual
    Funds; Real Estate; Statistics; Stocks; Taxes; Venture Capital. More News ยป. ...

  • Hedge Funds For Everyone

    http://stocks.investopedia.com/stock-analysis/2009/Hedge-Funds-For-Everyone-ALT-PIE-LSC1202.aspx
    ... 0.95% in expenses. However, if ALT is able to achieve its goals, it may
    be perfect as a poor man's hedge fund. Plenty of commodity ...

  • How Much Disaster Can Gold Hedge? - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0911/How-Much-Disaster-Can-Gold-Hedge.aspx
    ... Gold Is Good For Just because gold is not a perfect inflation hedge, nor an insurance
    policy against disaster, does not mean that it has no value and no use. ...

  • Capturing Profits With Position-Delta Neutral Trading

    http://www.investopedia.com/articles/optioninvestor/03/041503.asp
    ... As you can see from figure 1 above, the T+27 dashed line (the lower plot left of
    the vertical price marker) is nearly a perfect hedge all the way down to 825 ...

  • The Perfect Investment For Chocolate-Lovers - Investopedia.com

    http://financialedge.investopedia.com/financial-edge/0310/The-Perfect-Investment-For-Chocolate-Lovers.aspx
    ... The Perfect Investment For Chocolate-Lovers. Posted:
    March 8, 2010 11:38AM by Tony Daltorio. ...

  • Commodities: The Portfolio Hedge

    http://www.investopedia.com/articles/trading/05/021605.asp
    ... disorder are products that offer a haven of sorts - a hedge against inflation ... If
    there is perfect linear relationship, you'll have a correlation coefficient of 1 ...

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