long hedge

Long hedge

The purchase of a futures contract in anticipation of actual purchases in the cash market. Used by processors or exporters as protection against an advance in the cash price. Related: hedge, short hedge
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Long Hedge

The purchase of a futures contract with the intention of accepting delivery of the underlying asset. One conducts a long hedge in order to lock in a price for an asset one must purchase in the future. This protects the holder of the futures contract from volatility in the underlying asset's price. If the spot price of the underlying asset moves in a direction more beneficial for the holder, he/she can sell the futures contract and buy the asset at the spot price. An example of a long hedge is a situation in which a company needs to buy oil by June. The spot price of oil may be $70 per barrel, but the futures price for June delivery may be only $60. The company would choose to buy the futures contract at $60 per barrel. A long hedge is also called a buy hedge.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

long hedge

The purchase of a futures contract or call option to protect a short position against possible increases in the prices of commodities, currencies, indexes, or securities. For example, an investor might purchase a futures contract on fixed-income securities to protect against a decline in interest rates. Also called buying hedge.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in classic literature ?
Lucy hurried out of the room, but Maggie did not take the opportunity of opening her book; she let it fall on her knees, while her eyes wandered to the window, where she could see the sunshine falling on the rich clumps of spring flowers and on the long hedge of laurels, and beyond, the silvery breadth of the dear old Floss, that at this distance seemed to be sleeping in a morning holiday.
dmw Wf Since the move to New Williamfield in 2007, Joan's green fingers have been in evidence as - helped by her husband David - she has tended the garden areas around hh the club, including tackling a near 60 metre long hedge.This summer she also reorganised recycling at the club in another"green"project.
Unfortunately, the Arborvitaes caught fire and the fire spread quickly throughout the entire 65-foot long hedge. The fire was exceptionally close to both residences, but fortunately, neither home caught on fire.
The Long Hedge: Preserving Organizational Value Through Climate Change Adaptation provides a fine survey of organizational structure and adaptation issues facing them, tackling the wider question of how organizations need to assess costs and benefits of mitigating the impacts of climate change on business.
In a long hedge, a short position in the spot market ([Q.sub.s] < 0) is offset by a long position in the futures market (n > 0).
Manor Farm is approached over a long hedge and tree-lined drive with turn-circle.
The 70-metre long hedge is expected to be fully-grown in two years.
The museum hopes that the 80-metre long hedge of more than 400 trees will help recreate the setting around St Teilo's church, which was moved stone by stone from its original location outside Pontarddulais, near Swansea, to its new home at St Fagans.
He said of the 33ft wide, 150 yard long hedge: "We think it was planted in about 1710."
Two of the three gallops managed by Jockey Club Estates are already back in operation sooner than anticipated, and the woodchip surface at Long Hedge, which suffered the most severe damage, will be repaired within a few days.
The other type of hedge is an initial buy position in the futures market called a long hedge. Long hedges are used to protect against increasing values in the cash market.