naked position

(redirected from Unhedged)
Also found in: Dictionary.

Naked Position

A position that is not hedged. That is, the holder of a naked position has taken no step to reduce the risk inherent to the position. For example, if one buys 100 shares of AT&T, one is exposed to the risk that AT&T will decline in price. If one takes no action to prevent this (by buying put options or short selling AT&T, for instance), one holds a naked position in AT&T. Avoiding naked positions and hedging as much risk as possible is a substantial concern for many institutional investors.

naked position

A security position, either long or short, that is not hedged. For example, an investor short 500 shares of IBM with no other position in IBM stock (such as ownership of calls) has a naked position in that security. Because a naked position subjects the investor to large potential gains or losses, it is an aggressive investment position.
References in periodicals archive ?
Going forward, this divergence of global monetary policy stances could lead to further USD appreciation, which is likely to have negative implications for the large unhedged USD positions in many Emerging Markets (EMs) and lead to a tight USD liquidity squeeze around the world.
The expected dollar appreciation is likely to have negative implications for the large unhedged dollar positions in many emerging markets (EMs) and lead to a tight dollar liquidity squeeze around the world, QNB has said in a report.
Global Banking News-February 13, 2015--Citigroup warns Indian companies to avoid unhedged overseas debt
CIBC has both hedged positions through insurance as well as unhedged positions.
15, 1999 (the date on which the short position was closed) and the long position remained unhedged during that time.
But with a significant part of short-term liabilities, bank and nonbank, denominated in foreign currencies (predominantly dollars), unhedged, the initial pressure on domestic currencies was apparently too much to bear, leading to a sharp crack in the fixed exchange-rate structure of many East Asian economies.
Energen Corporation (NYSE: EGN) today announced that it is raising the underlying commodity price assumptions applicable to the unhedged production of its oil and gas exploration and production unit for the remainder of 2008 and for 2009.
Global Banking News-July 3, 2013--Central bank of India proposes higher provisioning for unhedged forex exposure(C)2013 ENPublishing - http://www.
When financial intermediaries, in addition, seek low-cost, unhedged foreign currency funding, the dangers of depositor runs, after a fall in the domestic currency, escalate.
During this period, the average prices the Company received for its oil and natural gas on an unhedged basis were $59.
To the extent that spot market prices fall, the company is exposed on the unhedged portion of its generation output.
Suncor added 2006 and 2007 collars, a departure from their almost completely unhedged situation in our last hedge report.