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A hedger in the Nasdaq 100 market is an individual who uses the futures market to
offset price risk when intending to sell or buy the actual Nasdaq 100. Hedging is possible because the Nasdaq 100 cash prices
and Nasdaq 100 futures prices tend to move in the same direction. However, the difference between the cash price and the futures
price may narrow or widen. The change in the difference between the cash price and the futures price is called basis
risk. Because of the changing basis no hedge can be perfect.
Where can you hedge the Nasdaq
100? The Nasdaq 100 can be hedged on the Chicago Mercantile Exchange (CME). The CME offers a competitive and transparent
market place to engage in efficient hedging strategies. If you are interested in hedging Nasdaq 100 please contact us. One of our experienced Nasdaq 100 traders will be happy to give you a call to discuss hedging strategies with you.
Hedge your Portfolio using Stock Index Futures
Click on the link above to
download a very informative .pdf brochure entitled "Hedge your Portfolio using Stock Index Futures.” It was published
by the Chicago Mercantile Exchange. This is a must read guide for any novice or advanced trader considering a hedge in the index
market using exchange traded S&P 500 Index futures and options.
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