What Is a Hedge? To hedge, in finance, is to take an offsetting position in an asset or investment that reduces the price risk of an existing position. A hedge is therefore a trade that is made with the purpose of reducing the risk of adverse price movements in another asset. Normally, a hedge consists
What Is Hedge Accounting? Hedge accounting is a method of accounting in which entries to adjust the fair value of a security and its opposing hedge are treated as one. Hedge accounting attempts to reduce the volatility created by the repeated adjustment to a financial instrument’s value, known as fair value accounting or mark to
What is Hedged Tender? A hedged tender is an investment strategy where an investor sells short a portion of shares they own in anticipation that not all shares tendered will be accepted. This strategy is used to protect against the risk of loss, in case the tender offer does not go through. The offer locks
What Is a Hedge Fund? A hedge fund is a limited partnership of private investors whose money is managed by professional fund managers who use a wide range of strategies, including leveraging or trading of non-traditional assets, to earn above-average investment returns. Hedge fund investment is often considered a risky alternative investment choice and usually
What is a Hedge Fund Manager? A hedge fund manager is firm or an individual who manages, makes investment decisions, and oversees the operations of a hedge fund. Managing a hedge fund can be an attractive career option because of its potential to be extremely lucrative. To be successful, a hedge fund manager must consider how to
What Is Hedonic Pricing? Hedonic pricing is a model that identifies price factors according to the premise that price is determined both by internal characteristics of the good being sold and external factors affecting it. A hedonic pricing model is often used to estimate quantitative values for environmental or ecosystem services that directly affect market
What Is an Heir? An heir is defined as an individual who is legally entitled to inherit some or all of the estate of another person who dies intestate, which means the deceased person failed to establish a legal last will and testament during their living years. In such a scenario, the heir receives property
What is Held at the Opening? Held at the opening is when a security is restricted from trading at the stock exchange’s daily opening. Trading in the security may be halted for a variety of reasons, but is typically a temporary situation which delays the official opening of that security. Key Takeaways Held at the
What Is a Held-For-Trading Security? A held-for-trading security is a debt or equity investment that investors purchase with the intent of selling within a short period of time, usually less than one year. Within that time frame, the investor hopes to see appreciation in the value of the security and sell it for a profit. Because of accounting
What Are Held-to-Maturity (HTM) Securities? Held-to-maturity (HTM) securities are purchased to be owned until maturity. For example, a company’s management might invest in a bond that they plan to hold to maturity. There are different accounting treatments for HTM securities compared to securities that are liquidated in the short term. How Held-to-Maturity (HTM) Securities Work Bonds and other
