From the practice of securities markets around the world, the risk hedging mechanism is established in the form of spot short selling, stock futures, stock index futures and stock options, stock index options and so on. Because the risk hedging mechanism of option products is essentially the same as that of futures, in a sense, they can be regarded as an extension of the function of futures products.
Therefore, the risk hedging mechanism in the international market is mainly divided into three forms: spot short selling, stock futures and stock index futures.
Extended data
Hedging mode
1, stock index futures hedging
Hedging of stock index futures refers to the behavior of taking advantage of the unreasonable price of stock index futures market, participating in the trading of stock index futures and stock spot market at the same time, or trading stock index contracts with different maturities and different (but similar) categories at the same time to earn the difference. Arbitrage of stock index futures can be divided into cash hedging, intertemporal hedging, cross-market hedging and cross-variety hedging.
2. Commodity futures hedging
Similar to the hedging of stock index futures, commodity futures also have hedging strategies. When buying or selling a futures contract, they sell or buy another related contract and close both contracts at a certain time.
It is similar to hedging in transaction form, but hedging is to buy (or sell) physical objects in the spot market and sell (or buy) futures contracts in the futures market; Arbitrage only buys and sells contracts in the futures market, and does not involve spot trading. Commodity futures arbitrage mainly includes cash hedging, intertemporal hedging, cross-market arbitrage and cross-variety arbitrage.
3. Statistical hedging
Different from risk-free hedging, statistical hedging is a kind of risk arbitrage by using the historical statistical law of securities prices, and its risk lies in whether this historical statistical law will continue to exist in the future. The main contents of statistical hedging include stock matching transaction, stock index hedging, securities lending hedging and foreign exchange hedging transaction.
4. Option hedging
Option, also known as option, is a derivative financial instrument based on futures. The essence of option is to price the rights and obligations in the financial field separately, so that the transferee of the right can exercise his right to trade or not to trade within a specified time, and the obligor must perform it.
5. Fixed hedging
Private placement, as one of the important ways of equity refinancing, has been widely concerned by the outside world because the price of private placement is often higher than the market price at the time of private placement.
When institutional investors participate in private placement, hedging with stock index futures is a better scheme to lock in income and reduce risk. Investors are advised to selectively participate in multiple private equity stocks, build spot portfolios to spread unsystematic risks, and at the same time hedge systemic risks with stock index futures to lock in private equity income.
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