Delta hedging, the most basic but also most commonly used

Hedging strategy for trading. It is nothing to do with lawyer or taxation people. It talks about to hedge the derivative contract with its underlying contract, based on the statistic correlation from the certain periods. The words quoted here are written in a more complicated way than needed. Don't be scared away and just google delta risk hedging trading, you will have a lot clues. The second paragraph is basically repeating the first paragraph, of course the small proportional movement between two contract at certain SD level indicates better hedge. Everyone with statistic knowledge should get it , without looking into these messy words:).  

所有跟帖： 

• 膜拜一个 -爱吃鱼鱼- ♀ (0 bytes) () 08/01/2016 postreply 20:20:30

• 能人啊。我就知道这KT有天才的。 -glueck- ♀ (0 bytes) () 08/01/2016 postreply 20:25:56

• 再问你一下，这个derivative contract 所包含的那些securities 是不是 -glueck- ♀ (396 bytes) () 08/01/2016 postreply 20:44:07

• Underlying contract always always exists before the derivative c -ppp6- ♀ (928 bytes) () 08/01/2016 postreply 21:29:53