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Hedge Accounting

This topic has 1 reply, 2 voices, and was last updated 5 years ago by P2-D2.

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May 18, 2019 at 2:25 pm #516342
gangsta1
Member
- Topics: 75
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Sir, does hedging eliminates the future risk all together or does it kinda balance the risk and reduce it to some level?
May 21, 2019 at 8:44 pm #516772
P2-D2
Keymaster
- Topics: 4
- Replies: 7065
Hi,
It won’t eliminate it as there will always be inefficiencies in the prices of the future/option and the price of the item we are hedging. It does remove a lot of the risk though.
Thanks
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