DEFINITION
Hedge Ratio

"Hedge ratio": The proportion of a hedging instrument required to hedge an underlying position, compared with the amount of the underlying position itself. So if four options are required to hedge a position of one unit of the underlying asset, the hedge ratio = ¼ = 0. 25.
Loading conversations.
Similar or Related Terms
Statistics
227
Characters
46
Words
39.67
Flesch Reading Ease
13.4
Flesch Kincaid Grade