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View the Currency presentation - ICICI Direct

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What is hedging – overview & concept?<br />

• Hedging is a position established in one market in an attempt to offset<br />

exposure in some opposite position in ano<strong>the</strong>r market.<br />

• The goal is to minimize one's exposure to unwanted risk.<br />

• Hedging is thus taking of a position, ei<strong>the</strong>r acquiring a cash flow or an asset<br />

or a contract(including a forward contract) that will rise(fall) in value to<br />

offset a fall(rise) in value of an existing position.

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