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Hedging Means: Definition, Example, Hedging with Options, Delta Hedging - Moneyfirstliv

As our lives are uncertain, in the same way, markets and stocks are uncertain, they do not always move straight in one direction. Due to this uncertainty, sometime trader or investor become fearful if the price moves against their direction. So to avoid fear and loss while trading, there is one technique called ' Hedging '. Hedging (safety against fear and losses)
To understand this technique/topic, let's take some simple examples like if anyone buys a new bike, then to avoid unnecessary costs while any accident, he/she buys insurance for his/her bike by paying some upfront premium (money) to the insurance company for one year, which provides him protection to his bike and his life with covering third party claim also. 
Let's take one more example if anyone buys a new car, then he will buy insurance to protect himself and his car from accidental cost and to protect himself from third party claim.

So from the above examples, we can conclude that he is simply hedging his…

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