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tasty Extras

Hedging Risk

tasty Extras

Options involve risk and are not suitable for all investors. Please read Characteristics and Risks of Standardized Options before deciding to invest in options.

The term delta-hedging refers to the manipulation of risk to help fit a desired tolerance. We hedge risk often not just on a trade level but on a portfolio level as well. By beta weighting positions, relative risk can be compared, and indicate possible adjustments on a portfolio level.

  • Examine risk of individual positions to determine how well they “Fit” the portfolio.

  • Make adjustments with greater precision to size and weight of a position.

Check out today’s show to learn more!

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