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In Hedge Fund management what does it mean to HEDGE?
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bosod...@gmail.com
Jul 31, 2018, 1:25:27 AM7/31/18
to
I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
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Peter Duncanson [BrE]
Jul 31, 2018, 5:48:46 AM7/31/18
to
On Mon, 30 Jul 2018 22:25:25 -0700 (PDT), bosod...@gmail.com wrote:
>I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
This is a reference to a hedge used as a boundary or barrier - OED:
>I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
1.
a. A row of bushes or low trees (e.g. hawthorn, or privet) planted
closely to form a boundary between pieces of land or at the sides
of a road: the usual form of fence in England.
3. trans. Said of any line or array of objects forming a barrier,
boundary, or partition.
4. transf. and fig. A barrier, limit, defence; a means of protection
or defence.
The verb "hedge":
1. trans. To surround with a hedge or fence as a boundary, or for
purposes of defence.
It is the "defence" sense that is used in financial jargon: protection
against loss.
8.
a. trans. To secure oneself against loss on (a bet or other
speculation) by making transactions on the other side so as to
compensate more or less for possible loss on the first.
c. To insure against risk of loss by entering into contracts which
balance one another. Also trans., to operate in (a commodity) in
this way.
--
Peter Duncanson, UK
(in alt.usage.english)
Harrison Hill
Jul 31, 2018, 1:53:21 PM7/31/18
to
On Tuesday, 31 July 2018 06:25:27 UTC+1, bosod...@gmail.com wrote:
> I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
As Peter says:
> I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
1) Hedge yourself round - with sharp bushes as a protection.
2) Hedge yourself "against" - bet on the opposite of what you expect
to happen - in case it doesn't happen.
Jack
Jul 31, 2018, 2:15:29 PM7/31/18
to
On Tue, 31 Jul 2018 10:48:39 +0100, "Peter Duncanson [BrE]"
<ma...@peterduncanson.net> wrote:
>On Mon, 30 Jul 2018 22:25:25 -0700 (PDT), bosod...@gmail.com wrote:
>
>>I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something 覧 I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
<ma...@peterduncanson.net> wrote:
>On Mon, 30 Jul 2018 22:25:25 -0700 (PDT), bosod...@gmail.com wrote:
>
>
>This is a reference to a hedge used as a boundary or barrier - OED:
>
> 1.
> a. A row of bushes or low trees (e.g. hawthorn, or privet) planted
> closely to form a boundary between pieces of land or at the sides
> of a road: the usual form of fence in England.
> 3. trans. Said of any line or array of objects forming a barrier,
> boundary, or partition.
> 4. transf. and fig. A barrier, limit, defence; a means of protection
> or defence.
>
>The verb "hedge":
>
> 1. trans. To surround with a hedge or fence as a boundary, or for
> purposes of defence.
>
>It is the "defence" sense that is used in financial jargon: protection
>against loss.
>
> 8.
> a. trans. To secure oneself against loss on (a bet or other
> speculation) by making transactions on the other side so as to
> compensate more or less for possible loss on the first.
> c. To insure against risk of loss by entering into contracts which
> balance one another. Also trans., to operate in (a commodity) in
> this way.
Used in the common phrase 'to hedge one's bets'.
>This is a reference to a hedge used as a boundary or barrier - OED:
>
> 1.
> a. A row of bushes or low trees (e.g. hawthorn, or privet) planted
> closely to form a boundary between pieces of land or at the sides
> of a road: the usual form of fence in England.
> 3. trans. Said of any line or array of objects forming a barrier,
> boundary, or partition.
> 4. transf. and fig. A barrier, limit, defence; a means of protection
> or defence.
>
>The verb "hedge":
>
> 1. trans. To surround with a hedge or fence as a boundary, or for
> purposes of defence.
>
>It is the "defence" sense that is used in financial jargon: protection
>against loss.
>
> 8.
> a. trans. To secure oneself against loss on (a bet or other
> speculation) by making transactions on the other side so as to
> compensate more or less for possible loss on the first.
> c. To insure against risk of loss by entering into contracts which
> balance one another. Also trans., to operate in (a commodity) in
> this way.
--
John
Garrett Wollman
Jul 31, 2018, 5:47:25 PM7/31/18
to
In article <7ff3302e-e528-42d0...@googlegroups.com>,
in other transactions that have the effect of limiting potential
losses (and sometimes potential gains) if the market does not perform
in the way the purchaser expects. For example, a fund could buy a
hundred thousand shares of a stock for $25, but at the same time buy a
thousand "put" options on the stock with a strike price of $20. If
the stock price stays above $25, the fund gets all the appreciation,
but loses the premium they paid to buy the options. If the stock
price goes below $20, they can exercise the option and get most of
their money back. If the stock price ends up between $20 and $25,
the fund loses some money but not all of it.
There are other sorts of instruments that qualify as hedges, like
insurance contracts, index futures, repurchase agreements, and so on
-- and these can be used to hedge both "long" (the investor is
planning to own the stock and the price to go up) and "short" (the
investor is planning to sell the stock, possibly borrowing it from
somebody else, in the expectation that the price will go down).
A "hedge fund" was originally a fund that specialized in making these
sorts of transactions to limit investors' risk. However, some hedge
fund operators were able to use loopholes in the rules that apply to
investment funds that are not sold to the general public, in order to
dramatically increase, rather than decrease, the risk using these
sorts of securities transactions. Nowadays, the term "hedge fund" is
used more broadly (some would say improperly) to apply to any
investment fund that invests primarily in securities, commodities,
options, and futures, and is restricted to "accredited investors".
-GAWollman
--
Garrett A. Wollman | "Act to avoid constraining the future; if you can,
wol...@bimajority.org| act to remove constraint from the future. This is
Opinions not shared by| a thing you can do, are able to do, to do together."
my employers. | - Graydon Saunders, _A Succession of Bad Days_ (2015)
<bosod...@gmail.com> wrote:
>I've done so much reading on this yet I still don't know WTF they mean
>by the Term "hedge fund", and moreover what's being hedged "against",
>and more generically speaking, what does it mean when you hedge against
>something
Financially speaking, to "hedge" an investment position is to engage
>I've done so much reading on this yet I still don't know WTF they mean
>by the Term "hedge fund", and moreover what's being hedged "against",
>and more generically speaking, what does it mean when you hedge against
>something
in other transactions that have the effect of limiting potential
losses (and sometimes potential gains) if the market does not perform
in the way the purchaser expects. For example, a fund could buy a
hundred thousand shares of a stock for $25, but at the same time buy a
thousand "put" options on the stock with a strike price of $20. If
the stock price stays above $25, the fund gets all the appreciation,
but loses the premium they paid to buy the options. If the stock
price goes below $20, they can exercise the option and get most of
their money back. If the stock price ends up between $20 and $25,
the fund loses some money but not all of it.
There are other sorts of instruments that qualify as hedges, like
insurance contracts, index futures, repurchase agreements, and so on
-- and these can be used to hedge both "long" (the investor is
planning to own the stock and the price to go up) and "short" (the
investor is planning to sell the stock, possibly borrowing it from
somebody else, in the expectation that the price will go down).
A "hedge fund" was originally a fund that specialized in making these
sorts of transactions to limit investors' risk. However, some hedge
fund operators were able to use loopholes in the rules that apply to
investment funds that are not sold to the general public, in order to
dramatically increase, rather than decrease, the risk using these
sorts of securities transactions. Nowadays, the term "hedge fund" is
used more broadly (some would say improperly) to apply to any
investment fund that invests primarily in securities, commodities,
options, and futures, and is restricted to "accredited investors".
-GAWollman
--
Garrett A. Wollman | "Act to avoid constraining the future; if you can,
wol...@bimajority.org| act to remove constraint from the future. This is
Opinions not shared by| a thing you can do, are able to do, to do together."
my employers. | - Graydon Saunders, _A Succession of Bad Days_ (2015)
Joseph C. Fineman
Jul 31, 2018, 5:59:41 PM7/31/18
to
"Peter Duncanson [BrE]" <ma...@peterduncanson.net> writes:
> It is the "defence" sense that is used in financial jargon: protection
> against loss.
>
> 8.
> a. trans. To secure oneself against loss on (a bet or other
> speculation) by making transactions on the other side so as to
> compensate more or less for possible loss on the first.
> c. To insure against risk of loss by entering into contracts which
> balance one another. Also trans., to operate in (a commodity) in
> this way.
However, I suspect (it has, of course, been made hard to tell) that that
> It is the "defence" sense that is used in financial jargon: protection
> against loss.
>
> 8.
> a. trans. To secure oneself against loss on (a bet or other
> speculation) by making transactions on the other side so as to
> compensate more or less for possible loss on the first.
> c. To insure against risk of loss by entering into contracts which
> balance one another. Also trans., to operate in (a commodity) in
> this way.
is not what "hedge funds", so called, actually do. I suspect that they
actually delay loss, thru the usual dodges, rather than prevent it.
They beat the market for a while, and then fail.
--
--- Joe Fineman jo...@verizon.net
||: Prose: Earth is turning us into its shadow. :||
||: Poetry: The sun is setting. :||
Garrett Wollman
Jul 31, 2018, 6:18:08 PM7/31/18
to
In article <86bmanf...@verizon.net>,
when there's a downturn.
Joseph C. Fineman <jo...@verizon.net> wrote:
>However, I suspect (it has, of course, been made hard to tell) that that
>is not what "hedge funds", so called, actually do. I suspect that they
>actually delay loss, thru the usual dodges, rather than prevent it.
>They beat the market for a while, and then fail.
No, they beat the market by finding some other sucker to hold the bag
>However, I suspect (it has, of course, been made hard to tell) that that
>is not what "hedge funds", so called, actually do. I suspect that they
>actually delay loss, thru the usual dodges, rather than prevent it.
>They beat the market for a while, and then fail.
when there's a downturn.
bill van
Jul 31, 2018, 10:36:20 PM7/31/18
to
On 2018-07-31 21:59:38 +0000, Joseph C. Fineman said:
> "Peter Duncanson [BrE]" <ma...@peterduncanson.net> writes:
>
>> It is the "defence" sense that is used in financial jargon: protection
>> against loss.
>>
>> 8.
>> a. trans. To secure oneself against loss on (a bet or other
>> speculation) by making transactions on the other side so as to
>> compensate more or less for possible loss on the first.
>> c. To insure against risk of loss by entering into contracts which
>> balance one another. Also trans., to operate in (a commodity) in
>> this way.
>
> However, I suspect (it has, of course, been made hard to tell) that that
> is not what "hedge funds", so called, actually do. I suspect that they
> actually delay loss, thru the usual dodges, rather than prevent it.
> They beat the market for a while, and then fail.
There is a category of hedge funds called vulture funds, which buy
> "Peter Duncanson [BrE]" <ma...@peterduncanson.net> writes:
>
>> It is the "defence" sense that is used in financial jargon: protection
>> against loss.
>>
>> 8.
>> a. trans. To secure oneself against loss on (a bet or other
>> speculation) by making transactions on the other side so as to
>> compensate more or less for possible loss on the first.
>> c. To insure against risk of loss by entering into contracts which
>> balance one another. Also trans., to operate in (a commodity) in
>> this way.
>
> However, I suspect (it has, of course, been made hard to tell) that that
> is not what "hedge funds", so called, actually do. I suspect that they
> actually delay loss, thru the usual dodges, rather than prevent it.
> They beat the market for a while, and then fail.
distressed companies for a song and operate them while selling off
saleable parts, using operating losses for tax advantages and generally
picking the remaining meat off the bones. My former employer, the
largest newspaper chain in Canada, is being sucked dry that way. When
the vultures are done, I don't know if there will be another buyer, or
a bunch of dead newspapers.
bill
Peter Moylan
Aug 1, 2018, 12:45:36 AM8/1/18
to
On 01/08/18 12:36, bill van wrote:
>
> There is a category of hedge funds called vulture funds, which buy
> distressed companies for a song and operate them while selling off
> saleable parts, using operating losses for tax advantages and
> generally picking the remaining meat off the bones. My former
> employer, the largest newspaper chain in Canada, is being sucked dry
> that way. When the vultures are done, I don't know if there will be
> another buyer, or a bunch of dead newspapers.
Australia is now in the sorry position where pretty much all newspapers
>
> There is a category of hedge funds called vulture funds, which buy
> distressed companies for a song and operate them while selling off
> saleable parts, using operating losses for tax advantages and
> generally picking the remaining meat off the bones. My former
> employer, the largest newspaper chain in Canada, is being sucked dry
> that way. When the vultures are done, I don't know if there will be
> another buyer, or a bunch of dead newspapers.
are in the hands of two owners. To make matters worse, the output of one
of those owners isn't even fit for wrapping fish.
Now we're discovering that the non-Murdoch press is about to be taken
over by a TV network. I'm currently waiting to see whether our local
newspaper is about to be thrown to the wolves.
--
Peter Moylan http://www.pmoylan.org
Newcastle, NSW, Australia
Bozo_D...@37.com
Jan 6, 2019, 3:43:20 PM1/6/19
to
On Monday, July 30, 2018 at 10:25:27 PM UTC-7, bosod...@gmail.com wrote:
> I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
In the meantime, I found this animation a quick study that some of you might appreciate too https://www.investopedia.com/terms/h/hedgefund.asp?utm_source=term-of-the-day&utm_campaign=bouncex&utm_term=15541206&utm_medium=email
> I've done so much reading on this yet I still don't know WTF they mean by the Term "hedge fund", and moreover what's being hedged "against", and more generically speaking, what does it mean when you hedge against something —— I don't know WTF that means, and how does it correspondingly apply to a landscaping feature when they use the term Hedge? Thank you.
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