short hedge

(redirected from Selling Hedge)

Short hedge

The sale of futures contracts to eliminate or lessen the possible decline in value of an approximately equal amount of the actual financial instrument or physical commodity. Related: Long hedge.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Short Hedge

The sale of a futures contract or option on a security or commodity one owns in order to hedge against the risk of decline in its price. In a short hedge, the price of the futures contract or option should move inversely to the price of the underlying asset. It is also called a selling hedge.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

short hedge

An investment transaction that is intended to provide protection against a decline in the value of an asset. For example, an investor who holds shares of Nextel and expects the stock to decline may enter into a short hedge by purchasing a put option on Nextel stock. If Nextel does subsequently decline, the value of the put option should increase.
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 periodicals archive ?
Verint Systems issued a statement in response to a presentation released by short selling hedge fund, Spruce Point Capital Management, LLC: "The self-serving short seller report disseminated today is inaccurate and deliberately misleading, and is intended to destroy shareholder value.
Reminds Members of Obligations When Selling Hedge Funds 48-49, rules regs/documents/notice_to_members/ nasdw_003358.pdf (Feb.
The selling hedge. Probably the simplest way to hedge is to sell production.
Scandinavian airline SAS has already announced that it is to restart hedging after being left exposed in the first quarter of 2004 and Swiss International Air Lines is facing potential losses after selling hedges to raise cash.