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Hedging

  • Hedging refers to a risk management strategy used by investors to reduce their exposure to potential losses.
  • It involves taking a position in one asset to offset the risk associated with another asset. In the crypto world, investors may hedge their positions by using derivatives such as futures contracts or options, or by diversifying their portfolio across different cryptocurrencies or assets.
  • The goal of hedging is to protect against adverse price movements while still maintaining the potential for gains