Definition

Describing a situation where a financial position is protected against potential losses by taking an opposite position in a related asset.

Example

The investor took a hedged position to minimize risks in the volatile market.

Conversation

I heard that your investments are all hedged now.

Yeah, it helps minimize the risks I was facing.

That makes sense; I should probably look into getting hedged too.

Definitely! It gives you more security in the market.

Synonyms & Antonyms

Definition

To protect oneself against loss or risk by making counterbalancing investments or decisions.

Example

The investor hedged his bets by diversifying his portfolio.

Tense Forms

Conversation

I can't believe how much you hedged during that debate yesterday!

I know, right? I was so nervous about making strong statements.

You really should have been more confident; your points were solid.

Root Explanation

Hedged → The word 'hedged' comes from 'hedge' (from Old English *hæcge*, meaning a fence or boundary formed by a dense row of shrubs or low trees) and the past participle suffix '-ed' (indicating completed action). The term 'hedged' refers to having enclosed or protected an area, often implying a sense of security or limitation.

Memory Tip

Think of a 'hedge' as a protective fence made of plants, and when something is 'hedged', it means it is enclosed or secured by that boundary.

Visually Confused Words