hedging

Cultural  

1. The practice by which a business or investor limits risk by taking positions that tend to offset each other. For example, a business stands to lose money if the price of a commodity it holds declines, but it can offset this risk by agreeing to sell a specified amount of the commodity at a set price at some point in the future.

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Hedge funds, which are investment funds usually open only to the very wealthy, grew in the 1990s. The near failure of one such fund in 1998, Long-Term Capital Management, sent shock waves through Wall Street.

Example Sentences

To secure the extraordinary unrealized profits that define so many portfolios, investors could consider our preferred hedging strategy: ratio spreads.

From Barron's • Jun. 3, 2026

After Kalshi CEO Tarek Mansour posted on X about the promotion, social-media users responded by pointing out that a small business hedging potential losses tied to a promotion wasn’t exactly a new concept.

From MarketWatch • Jun. 2, 2026

That will provide a revenue boost to SpaceX’s money-losing AI business, but also sends an interesting signal—that the famously risk-tolerant Musk feels frontier AI is a bet worth hedging on.

From The Wall Street Journal • May 27, 2026

Beyond hedging, Kalshi said that its new markets also provide retail speculators and casual art aficionados a way to get in on the auction action.

From Barron's • May 26, 2026

Two of the archers followed them, a wordless presence hedging them in.

From Anya and the Nightingale by Sofiya Pasternack

Related Words

• prevarication