WPX will retain more than $110 million in additional hedge
gains, which will be realized throughout the year.
Its diverse business model (in terms of geography and real estate segments, with the additional hedge
of construction materials production) largely offsets the common perception that developers are a bad bet in uncertain times.
In addition to higher yields, some alternative investments can provide an additional hedge
to insurers against low interest rates, due to their negative correlation with traditional investments," Deloitte says.
In fact, some would argue that actually borrowing money at fixed rates is an additional hedge
, which is currently an option for performing properties through Fannie Mae, Freddie Mac and FHA.
As the dissent put it, if Bentley paid rent on time during the first three years of the lease, Madison would have a substantial "degree of security" that Bentley could be "trusted to perform during the ensuing seven years," but conversely, the failure of Bentley to timely pay rent would "increase [Madison's] risk and lead it to seek the additional hedge
of a continuing guaranty from the Millers.
The Nationwide Inflation-Protected Securities Fund provides an additional hedge
against future inflation without requiring investors to take on additional credit risk.