Instead of hedging, O'Brien has essentially recommitted.
Mr. ARRINGTON: Speaking of hedging.
This increased the cost of hedging.
Many factors are likely to drive the markets during these last two months of the year, including health care reform, Afghanistan and the possibility of large hedge funds being taken down in the SEC's stepped-up approach to regulatory enforcement.
The third proposition of the paper that a narrow range of acceptable information exists such that lending in an environment of imperfect information is worthwhile, points to the possibility of creating a hedging portfolio (Yoon and Smith 2002).
The economic literature has long speculated about the possibility of "survivor bonds" to hedge this longevity risk by paying off when a generation lives longer than expected.
As America's most anti-activist law firm, Wachtell, Lipton, Rosen & Katz, gloated in a recent memo: "The dark cloud of the international credit crunch...may yet have a small silver lining for public companies: the real possibility of a decline in hedge fund activism".
Hedging trades the possibility of a future gain for elimination of the possibility of a loss.
In Mongolia, the World Bank recently gave goatherders the chance to hedge against the possibility of a disastrous number of their goats dying.
But then, if majority voting is hedged with the possibility of a veto "in cases of vital national interest" or over sending soldiers into harm's way, it would lose much of its purpose.
