Commercial Hedger


Commercial Hedger

A corporation that purchases futures to control its costs. When a corporation uses a commodity in the creation of its product or service, hedging can help to keep that commodity affordable. A construction company, for example, could be called a commercial hedger if it purchased steel futures to control its rebar costs. Another example is an airline company that purchases crude oil futures to balance its fuel costs.

Commercial hedging is a way for companies to reduce price risk by locking in the price of production goods. This practice can be used in almost any line of business, but it is common in agriculture and banking. Companies also commonly hedge against interest-rate risk and foreign-exchange risk. Hedging does not eliminate the possibility of a corporation being negatively impacted by price changes, but it can soften the blow. This is similar to an individual purchasing homeowner’s insurance. The insurance doesn't eliminate the possibility of his house burning down, but does drastically reduce the costs he'll have to pay if it does.


Investment dictionary. . 2012.

Look at other dictionaries:

  • ХЕДЖЕР — любое предприятие, банк, фермер или другой хозяйствующийсубъект, осуществляющий операции на фьючерской бирже, называемые хеджи рованием. Словарь финансовых терминов. Хеджер Хеджер компания, которая оперирует на фьючерсном рынке для страхования… …   Финансовый словарь

  • futures — Commercial contracts calling for the purchase or sale of specified quantities of a good at specified future dates. The good in question may be grain, livestock, precious metals, or financial instruments such as treasury bills. Up until the time… …   Universalium

  • Cradle Of Filth — Le groupe en 2008 Pays d’origine …   Wikipédia en Français

  • Cradle of filth — Le groupe en 2008 Pays d’origine …   Wikipédia en Français

  • Goetia (album) — Cradle of Filth Cradle of Filth Le groupe en 2008 Pays d’origine …   Wikipédia en Français

  • Liste des membres de Cradle of Filth — Cradle of Filth Cradle of Filth Le groupe en 2008 Pays d’origine …   Wikipédia en Français

  • Cradle of Filth — Le groupe en 2008 Pays d’origine …   Wikipédia en Français

  • Commitment of Traders Report — Der Commitment of Traders Report wird im Original als Commitments of Traders (CoT) bezeichnet. Hierbei handelt es sich um einen regelmäßig veröffentlichten Bericht der Commodity Futures Trading Commission (CFTC), welche als Regulierungsstelle der …   Deutsch Wikipedia

  • Hedge (finance) — For other uses, see Hedge (disambiguation). Finance Financial markets …   Wikipedia

  • Futures contract — Financial markets Public market Exchange Securities Bond market Fixed income Corporate bond Government bond Municipal bond …   Wikipedia


We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.